MSO Rules v16 - Australian Energy Regulator | 5 MSOR... · Web viewMSO Rules Amendments to facilitate Full Retail Contestability: The following changes/additions to the MSO Rules

VENCorp Market & System Operations Rules

Appendix 5 to VENCorp Access Arrangement: Market and System Operational Rules

Victorian Gas Industry Market and System Operations Rules

VERSION 1628 February 2002

This version incorporates, for information only, MSO Rules amendments for the introduction of “site AMDQ credits” and “full retail contestability”. These amendments have been approved by the VENCorp Board of Directors and have received authorisation under the Trade Practices Act by the ACCC.

Implementation of these amendments will take place as required on a date to be advised.

Version 16: 28 February 2002


An Order in Council dated 2 February 1999 made under the Gas Industry Act 1994, and published in the Victorian Government Gazette dated 4 February 1999, established the “Victorian Gas Industry Market and System Operations Rules” (the MSO Rules).

The MSO Rules have subsequently been modified by:

1. an Order in Council dated 23 February 1999, published in the Gazette dated 25 February 1999;

2. an Order in Council dated 10 March 1999, published in the Gazette dated 11 March 1999;

3. an Order in Council dated 28 April 1999, published in the Gazette dated 13 May 1999;

4. an Order in Council corrigenda, published in the Gazette dated 13 May 1999;

5. an Order in Council dated 29 June 1999, published in the Gazette dated 8 July 1999;

6. an Order in Council corrigenda, published in the Gazette dated 8 July 1999;

7. an Order in Council corrigenda, published in the Gazette dated 22 July 1999

8. a Notice published in the Gazette dated 4 November 1999

9. a Notice published in the Gazette dated 18 May 2000

10. a Notice published in the Gazette dated 29 June 2000

11. a Notice published in the Gazette dated 24 August 2000

12. a Notice published in the Gazette dated 15 February 2001

13. a Notice published in the Gazette dated 14 June 2001

14. a Notice published in the Gazette dated 5 July 2001

15. two Notices published in the Gazette dated 30 August 2001

16. a Notice published in the Gazette dated 28 February 2002

The MSO Rules presented in this document reflect the changes noted above and further detailed in the tabole below.

RULE CHANGES CHANGE EFFECTIVE FROM

RULES AFFECTED AUTHORITY

25/02/99 1.1 Order in Council dated 23/02/99, published in the Victorian Government Gazette 25/0299

11/03/99 1.13.13.64.4

5.37.110.211 Glossary

Order in Council dated 10/03/99, published in the Victorian Government Gazette 11/03/99

13/05/99 3.13.64.45.3

6.710.311 Glossary


13/05/99 3.6 Corrigenda to Order in Council, published in the Victorian Government Gazette 13/05/99

Version 16: 28 February 2002 Page i of iii


08/07/99 3.65.26.16.26.46.711 Glossary1.1

1.23.15.3Schedule 7.18.18.58.610.2


08/07/99 1.23.6

Corrigenda to O in C dated 2 February 1999 published in the Victorian Government Gazette 08/07/99.

22/07/99 6.26.4

7 Corrigenda to O in C dated 2 February 1999 published in the Victorian Government Gazette 08/07/99.

04/11/99 5.2Schedule 7.1

11 Notice published in the Victorian Government Gazette 04/11/99.

00/05/00 3.2.43.2.55.33.6.7

3.6.89.1.111

Notice published in the Victorian Government Gazette 18/05/00.

01/07/00 3.2.13.6.5

3.811

Notice published in the Victorian Government Gazette 29/06/00.

24/08/00 3.7.83.794.174.4.14.4.6

4.4.144.4.184.4.224.4.2411

Notice published in the Victorian Government Gazette 24/08/00

21/02/01 3.6.63.6.235.1.75.2.15.2.25.2.3

5.2.46.6.56.7.6Schedule 7.111


14/06/01 3.6.63.6.126.2.26.5.2

6.6.56.7.67.2.111


05/07/01 5.3.25.3.3

5.3.5 Notice published in the Victorian Government Gazette 05/07/01

30/08/01 1.2.15.3.35.3.6

7.1.58.1

Two Notices published in the Victorian Government Gazette 30/08/01

Version 16: 28 February 2002 Page ii of iii


28/02/02 1.1.41.2.32.13.1.43.1.53.1.63.1.83.1.93.1.103.1.123.2.13.2.43.2.53.3.23.6.63.6.73.6.83.6.113.6.123.6.163.6.174.2.24.2.8

4.2.94.3.24.4.14.4.24.4.34.4.64.4.94.4.134.4.184.4.214.4.27Sch 4.25.1.46.2.16.4.36.7.26.9.1Sch 7.18.18.48.58.68.811


Version 16: 28 February 2002 Page iii of iii


INDEX

CHAPTER 1. INTRODUCTION......................................................................................................................11.1 PURPOSE AND APPLICATION OF RULES..........................................................................................21.2 VENCORP............................................................................................................................................... 51.3 ENFORCEABILITY AND AMENDMENT OF THESE RULES.............................................................81.4 PUBLIC CONSULTATION PROCEDURES...........................................................................................9

CHAPTER 2. REGISTRATION....................................................................................................................102.1 REGISTRATION WITH VENCORP.....................................................................................................112.2 CEASING TO BE A MARKET PARTICIPANT....................................................................................132.3 SUSPENSION........................................................................................................................................ 142.4 LIABILITY OF DEREGISTERED PARTICIPANTS.............................................................................142.5 INTENTION TO COMMENCE ACTIVITIES OR FUNCTIONS...........................................................142.6 MARKET FEES..................................................................................................................................... 152.7 PREVIOUS FINANCIAL YEAR REPORT............................................................................................18

CHAPTER 3. MARKET OPERATION AND ADMINISTRATION...............................................................203.1 GAS SCHEDULING.............................................................................................................................. 213.2 DETERMINATION OF MARKET PRICE............................................................................................333.3 PARTICIPANT COMPENSATION FUND............................................................................................363.5 ALLOCATION AND RECONCILIATION............................................................................................393.6 SETTLEMENTS.................................................................................................................................... 503.7 PRUDENTIAL REQUIREMENTS........................................................................................................ 723.8 GST....................................................................................................................................................... 79

CHAPTER 4. TECHNICAL MATTERS........................................................................................................804.1 CONNECTION TO THE TRANSMISSION SYSTEM..........................................................................814.2 LNG STORAGE.................................................................................................................................... 874.3 GAS QUALITY..................................................................................................................................... 934.4 METERING........................................................................................................................................... 97SCHEDULE 4.1 METERING UNCERTAINTY LIMITS AND CALIBRATION REQUIREMENTS......119SCHEDULE 4.2 METERING REGISTER...............................................................................................121SCHEDULE 4.3 INSTALLATION DATABASE.....................................................................................124

CHAPTER 5. MARKET INFORMATION AND SYSTEM PLANNING.....................................................1265.1 MARKET INFORMATION................................................................................................................. 1275.2 FORECASTS AND PLANNING AND MAINTENANCE REVIEWS..................................................1315.3 MDQ AUTHORISATION.................................................................................................................... 1365.4 CONFIDENTIALITY.......................................................................................................................... 143

CHAPTER 6. INTERVENTION AND MARKET SUSPENSION...............................................................1466.1 OVERVIEW........................................................................................................................................ 1476.2 EMERGENCIES.................................................................................................................................. 1496.3 EMERGENCY PLANNING BY PARTICIPANTS...............................................................................1526.4 EMERGENCY CURTAILMENT OF CUSTOMERS...........................................................................1536.5 RESPONSE TO AN EMERGENCY.....................................................................................................1566.6 SYSTEM SECURITY THREAT.......................................................................................................... 1596.7 FORCE MAJEURE AND MARKET SUSPENSION............................................................................1636.8 REVIEW OF CHAPTER 6................................................................................................................... 1676.9 EMERGENCY LEGISLATION........................................................................................................... 168

CHAPTER 7. ENFORCEMENT AND DISPUTES.....................................................................................1697.1 ENFORCEMENT................................................................................................................................ 1707.2 DISPUTE RESOLUTION.................................................................................................................... 172SCHEDULE 7.1 CLASSIFICATION OF RULES....................................................................................181


CHAPTER 8. RULES CHANGES..............................................................................................................2128.1 CHANGING THESE RULES............................................................................................................... 2138.2 PROPOSALS BY PERSONS OTHER THAN VENCORP....................................................................2148.3 VENCORP’S CONSIDERATION OF PROPOSED RULE CHANGE..................................................2148.4 VENCORP DECISION ON RULE CHANGE PROPOSED BY OTHER PERSON..............................2148.5 APPLICATION TO THE REGULATOR.............................................................................................2158.6 THE REGULATOR’S ASSESSMENT OF RULE CHANGE...............................................................2168.8 IMPLEMENTATION OF RULE CHANGE.........................................................................................216

CHAPTER 9. TRANSITIONAL ARRANGEMENTS AND DEROGATIONS............................................2189.2 DEROGATIONS.................................................................................................................................. 219

CHAPTER 10 INTERPRETATION..............................................................................................................22010.1 INTERPRETATION........................................................................................................................ 22110.2 GENERAL...................................................................................................................................... 22110.3 TIMES AND DATES...................................................................................................................... 22210.4 TECHNICAL INTERPRETATION.................................................................................................22310.5 ASSIGNMENT................................................................................................................................ 22410.6 WAIVER......................................................................................................................................... 22410.7 PAYMENT...................................................................................................................................... 22410.8 NOTICES........................................................................................................................................ 22410.9 RETENTION OF RECORDS AND DOCUMENTS.........................................................................22610.10 SEVERABILITY............................................................................................................................. 226

CHAPTER 11. GLOSSARY..........................................................................................................................227


CHAPTER 1. INTRODUCTION

Version 16: 28 February 2002 Page 1 of 243


1.1 PURPOSE AND APPLICATION OF RULES

1.1.1 The Market and System Operations Rules(a) These Rules are the Market and System Operations Rules.

(b) In these Rules:

(1) subject to clause 10.2(o), words and phrases which appear in italics are defined in the glossary in chapter 11; and

(2) technical concepts relating to gas measurement are described in clause 10.4.

(c) These Rules must be interpreted in accordance with the provisions of chapter 10.

1.1.2 PurposeThe purpose of these Rules is:

(a) to provide an efficient, competitive and reliable market;(b) to regulate the operation and administration of the market;(c) to regulate the activities of Participants in and in relation to the transmission system and

the market; (d) to regulate the operation of the transmission system by VENCorp in a way which:

(1) minimises threats to system security;(2) encourages the achievement of the market objectives; and

(3) enables access to the transmission system and the market; and

(e) to facilitate VENCorp’s performance of the VENCorp functions.

1.1.3 The regulatory frameworkThese Rules form part of the regulatory framework which:

(a) is applicable to the owners, operators and users of the transmission system under the Gas Industry Act; and

(b) may also be applicable to the owners and operators of transmission pipelines as part of their access arrangements, required by and applicable under the Access Code,

which is represented diagrammatically below.



REGULATORY FRAMEWORK

MSO Rules Amendments to facilitate Full Retail Contestability:

The following changes/additions to the MSO Rules have been approved by the VENCorp Board of Directors and have received authorisation under the Trade Practices Act by the ACCC.

Implementation of these amendments to the MSO Rules will take place as required to facilitate the implementation of full retail contestability, at a date to be advised.

1.1.3 The regulatory framework

Diagram will be altered to incorporate Retail Rules

1.1.4 OperationThe commencement date of these Rules is:

(1) for Chapters 1, 2, 5, 8, 10 and 11, the date on which these Rules were made under section 48N of the Gas Industry (Residual Provisions) Act 1994; and

(2) for Chapters 3, 4, 6, 7 and 9, 15 March 1999.

1.1.5 Application of these Rules(a) A person other than VENCorp who:

(1) is bound to comply with these Rules under the Gas Industry Act and/or as part of an access arrangement; and/or

(2) holds a retail licence under the Gas Industry Act and sells gas to Customers which has been transported through the transmission system; and/or

(3) wishes to undertake activities or participate in the market,must register with VENCorp in accordance with chapter 2.


GAS INDUSTRY ACT 2001 (VIC)

Victorian Access Code

DistributionSystemCode

(including retail metering)

MSO Rules

VENCorp

PARTICIPANTS

• Retailers

• Distributors

• Producers

• Traders

• Storage Providers

• Transmission Customers

• Distribution Customers

• Transmission Pipeline Owners

• Interconnected Pipeline Owners

AccessArrangements

Distribution Licence

Office of the Regulator-

General(Distribution)

ACCC(Transmission/

MSOR)

Tariff Order

Retail Licence


(b) Subject to clause 1.1.6, a person who is registered with VENCorp as a Participant under chapter 2 is bound by these Rules.

1.1.6 System Bypass

Nothing in these Rules limits the rights of any person to construct, own or operate a pipeline or pipeline equipment which is not part of the transmission system and which is not subject to these Rules.



1.2 VENCORP

1.2.1 Obligations of VENCorp(a) VENCorp must:

(1) operate the transmission system; and

(2) operate and administer the market,in accordance with the Gas Industry Act and these Rules and taking into consideration the VENCorp functions and the market objectives and VENCorp must allocate appropriate resources to enable it to do so.




1.2.1(a) to be altered as follows:

(a) VENCorp must:

(1) operate the transmission system; and

(2) operate and administer the market,

in accordance with the Gas Industry Act and these Rules and the Retail Gas Market Rules and taking into consideration the VENCorp functions and the market objectives and VENCorp must allocate appropriate resources to enable it to do so.

(b) VENCorp must maintain and publish a register of Participants and must update and publish the register whenever a person becomes or ceases to be a Participant.

(c) In consultation with Participants, VENCorp must develop and update from time to time system security guidelines in accordance with which VENCorp will be required to operate the transmission system in a way which minimises threats to system security, and the system security guidelines must be provided to:

(1) the Regulator on completion and after any update of the system security guidelines; and

(2) Participants and interested persons on request.

(d) Should VENCorp propose a change to the system security guidelines which, in VENCorp’s reasonable opinion is a material change then, prior to its implementation, that proposed change must be reviewed in accordance with the public consultation procedures.

(e) VENCorp must monitor daily trading activity in the market:(1) with a view to ensuring that such trading is performed in accordance with these

Rules; and

(2) to identify any significant price variations in and between trading intervals.

(f) If VENCorp identifies any significant price variations in and between trading intervals, VENCorp must:

(1) within ten business days notify Participants of this event; and



(2) within ten business days following the issue of the final statement for that trading interval, prepare a report setting out the identified significant price variations

(g) VENCorp must provide a copy of the report referred to in clause 1.2.1(f) to:

(1) the Regulator on completion of the report; and


(h) VENCorp must, in consultation with the Regulator, develop guidelines as to what constitutes a significant price variation.

(i) Where these Rules require VENCorp to develop procedures, processes or systems, VENCorp must do so after taking into consideration the likely costs to Participants of complying with those procedures or processes and of obtaining, installing or adopting those systems, as the case may be.

(j) VENCorp must comply with each of the requirements and obligations imposed on it under these Rules.

(ja) VENCorp may do such other things as are consequential or incidental upon the obligations set out in clauses 1.2.1(a) to 1.2.1(f) inclusive.

(k) For the purposes of the Tariff Order, the obligations and functions of VENCorp as described in this clause 1.2.1, are the tariffed VENCorp services.

1.2.2 Limitation of liability of VENCorpVENCorp is not to be liable for any loss or damage suffered or incurred by a Participant or any other person as a consequence of any act or omission by VENCorp, except:

(a) as expressly provided for in these Rules;

(b) to the extent that VENCorp can and does recover compensation from any Participant or any other person in respect of any such loss or damage, after deducting its costs, if any, of recovering that compensation; and

(c) to the extent that VENCorp can and does recover compensation under a policy of insurance in respect of any such loss or damage, after deducting its costs, if any, of recovering that compensation.

Clause 1.2.3 deleted by notice in the Government Gazette dated 28 February 2002

1.2.4 VENCorp performance(a) Unless otherwise expressly provided in these Rules, nothing in these Rules is to be

construed as imposing upon VENCorp any obligation or duty to, or enforceable by, a Participant or any other person and a Participant must not make any commitment to any person binding on or purporting to bind VENCorp.

(b) Nothing in these Rules prevents VENCorp from exercising any right or remedy which it may have against a person at law or pursuant to the Gas Industry Act or otherwise.

(c) In exercising its discretions and performing its obligations under these Rules, VENCorp must at all times:

(1) act in a reasonable and prudent manner; and

(2) act reasonably and in good faith in its dealings with Participants;

except to the extent that:



(3) there is any standard of performance already provided for by any statute, regulation or licence condition to which VENCorp is subject; or

(4) VENCorp would thereby be required to act in a manner which would conflict with any requirement of law.

(d) For the avoidance of doubt the operation of clause 1.2.4(c) does not prevent VENCorp from performing any obligation under these Rules.

(e) At least once in every calendar year, VENCorp must publish performance indicators which provide an indication of, and monitor, VENCorp’s performance under these Rules in respect of the VENCorp functions and the market objectives.



1.3 ENFORCEABILITY AND AMENDMENT OF THESE RULES

1.3.1 EnforceabilityThese Rules are enforceable in accordance with chapter 7.

1.3.2 Changes to these RulesAmendments to these Rules must be made in accordance with chapter 8.



1.4 PUBLIC CONSULTATION PROCEDURES

Where these Rules identify matters which are subject to review or consultation in accordance with the public consultation procedures, VENCorp must ensure that, as a minimum, the following procedures are followed:

(a) VENCorp must advertise particulars of the matter to Participants and other interested persons, inviting written submissions concerning the matter to be made by a specified date;

(b) where, in the reasonable opinion of VENCorp, there is a diversity of views expressed in the written submissions received under clause 1.4(a), VENCorp must invite Participants and other interested persons to a meeting or meetings at which those views may be presented and discussed;

(c) following its consideration of the matter under consultation, VENCorp must prepare a report setting out:

(1) the matter under consultation;

(2) VENCorp’s decision in relation to the matter;

(3) the reasons for VENCorp’s decision;

(4) the findings on material questions of fact, referring to evidence or other material on which those findings were based; and

(5) the procedures followed in considering the matter; and

(d) VENCorp must provide a copy of the report referred to in clause 1.4(c) to:





CHAPTER 2. REGISTRATION



2.1 REGISTRATION WITH VENCORP

(a) Each Transmission Pipeline Owner whose transmission pipeline forms part of the transmission system and each person whose pipeline or pipeline equipment, gas production facility or storage facility is connected to the transmission system must register with VENCorp as a Participant (unless that person is an Exempt Person) in any one or more of the following categories:

(1) Transmission Pipeline Owners;

(2) Interconnected Pipeline Owners;(3) Producers;

(4) Transmission Customers;

(5) Distributors; and

(6) Storage Providers.

(b) A person who:

(1) holds a retail licence under the Gas Industry Act; and

(2) sells gas to Customers which has been transported through the transmission system,

must register with VENCorp as a Participant unless that person is an Exempt Person.

(c) Subject to clause 2.1(e), a person may apply to VENCorp to be registered as a Market Participant in one or more of the following categories:

(1) Producers;

(2) Traders;

(3) Retailers;

(4) Transmission Customers;

(5) Distribution Customers; or

(6) Storage Providers.

(d) A person may not undertake activities or participate in or in relation to the market in a category set out in clause 2.1(c) unless the person is registered as a Market Participant in that category.

(e) A person is not eligible to be registered as a Market Participant unless the person:

(1) is a resident in, or is permanently established in, Australia;

(2) is, in respect of Transmission Customers and Distribution Customers, a person who is a Non-Franchise Customer;

(3) is not under external administration (as defined in the Corporations Law) or under a similar form of administration under any laws applicable to that person in any jurisdiction;

(4) is not immune from suit in respect of the obligations of a Participant under these Rules;



(5) is capable of being sued in its own name in a court of Australia; and

(6) has entered into and continues to be a party to an agreement providing for the payment of transmission charges associated with the provision of services by a Transmission Pipeline Owner under a service envelope agreement,

and if at any time a Market Participant ceases to be eligible to be registered as a Market Participant in accordance with this clause 2.1(e), that Market Participant must inform VENCorp accordingly and as soon as practicable after VENCorp becomes aware that a Market Participant is no longer eligible to be registered, VENCorp must issue a suspension notice in respect of that Market Participant in accordance with clause 3.7.7.




2.1(e) to be altered as follows:

(e) A person is not eligible to be registered as a Market Participant unless the person:

(1) is a resident in, or is permanently established in, Australia;

(2) is, in respect of Transmission Customers and Distribution Customers, a person who is a Non-Franchise Customer;

(3) is not under external administration (as defined in the Corporations Law) or under a similar form of administration under any laws applicable to that person in any jurisdiction;

(4) is not immune from suit in respect of the obligations of a Participant under these Rules;

(5) is capable of being sued in its own name in a court of Australia; and

(6) has entered into and continues to be a party to an agreement providing for the payment of transmission charges associated with the provision of services by a Transmission Pipeline Owner under a service envelope agreement,

and if at any time a Market Participant ceases to be eligible to be registered as a Market Participant in accordance with this clause 2.1(e), that Market Participant must inform VENCorp accordingly and as soon as practicable after VENCorp becomes aware that a Market Participant is no longer eligible to be registered, VENCorp must issue a suspension notice in respect of that Market Participant in accordance with clause 3.7.7.

(f) Applications for registration must be submitted to VENCorp in the form prescribed by VENCorp and must be accompanied by a registration fee (if any) fixed by VENCorp.

(g) If an applicant applies for registration in one of the categories specified in clause 2.1(c), that applicant must satisfy prudential requirements in accordance with clause 3.7 and must provide to VENCorp documentary evidence of its compliance with the relevant prudential requirements with the application for registration.

(h) Within five business days of receiving an application, VENCorp must advise the applicant of any further information which VENCorp reasonably considers to be required to enable VENCorp properly to assess the application and if VENCorp has not received that further information which it reasonably considers satisfy the relevant application requirements within a further fifteen business days, VENCorp may treat the application as withdrawn and if VENCorp incurs additional costs as a result of requesting and assessing that further information VENCorp may require the applicant to pay to VENCorp a reasonable amount to cover those additional costs.



(i) If an application for registration in one or more of the categories set out in clause 2.1(a), (b) and/or (c) has been received by VENCorp and:

(1) all relevant application requirements have been satisfied;

(2) the applicant is eligible to be registered in the category or categories in which registration is sought;

(3) VENCorp reasonably considers that the applicant will be able to comply and maintain compliance with these Rules;

(4) VENCorp reasonably considers that the applicant is of sufficient financial standing or has sufficient credit support to meet its financial obligations; and

(5) if the applicant seeks registration as a Market Participant, the applicant satisfies any applicable prudential requirements,

then subject to clause 2.1(e), VENCorp must approve the application and register the applicant in the category or categories to which the application relates providing that if the application satisfies the requirements of this clause 2.1(i) in respect of a fewer number of categories than those for which registration is sought, VENCorp must register the applicant only in that category or in those categories in respect of which the requirements of this clause 2.1(i) are satisfied.

(j) If VENCorp approves an application under clause 2.1(i), VENCorp must send written notice of approval to the applicant within fifteen business days of receiving:

(1) the application under clause 2.1(f); or

(2) if further information and/or fees are required under clause 2.1(h), that further information and/or fees,

and registration of the applicant as a Participant will take effect on the date specified in the notice of approval which must be a date not more than seven days after the date on which VENCorp sends the notice of approval under this clause 2.1(j).

(k) If VENCorp does not approve an application for registration in a category to which an application relates, VENCorp must send written notice to the applicant advising the applicant that the application is not approved and VENCorp must give reasons for its decision.

2.2 CEASING TO BE A MARKET PARTICIPANT

(a) A person may notify VENCorp in writing that it wishes to cease to be registered in any one or more categories of Market Participant set out in clause 2.1(c).

(b) In a notice given under clause 2.2(a), a Market Participant must specify a date upon which it wishes to cease to be registered.

(c) On receipt of a notice under clause 2.2(a), VENCorp must notify all Market Participants that the person who gave the notice will cease to be a Market Participant and the date on which that will occur.

(d) If VENCorp notifies Market Participants that a Market Participant will cease to be registered on a specified date, that Market Participant must cease all trading and all other activities in the market from that date.

2.3 SUSPENSION

(a) Subject to clause 2.3(b), if a Market Participant receives a suspension notice from VENCorp in accordance with any provision of these Rules, that Market Participant is



suspended from participation in the market unless and until VENCorp in its absolute discretion declares the suspension notice to be revoked in accordance with clause 3.7.7.

(b) If VENCorp issues a suspension notice to any Market Participant under which VENCorp declares that the Market Participant is to be deregistered as a Market Participant, the Market Participant is deemed to be deregistered as a Market Participant from the date specified in the suspension notice.

2.4 LIABILITY OF DEREGISTERED PARTICIPANTS

Notwithstanding that a person is no longer registered as a Participant for any reason, that person’s obligations and liabilities which arose under these Rules prior to the date on which that person was deregistered remain unaffected by the deregistration.

2.5 INTENTION TO COMMENCE ACTIVITIES OR FUNCTIONS

(a) Any person who intends to register as a Participant may register with VENCorp as an Intending Participant if that person can satisfy VENCorp of its bona fide intent to commence an activity which would entitle or require that person to be registered as a Participant once that activity is commenced.

(b) Applications for registration as an Intending Participant must be submitted to VENCorp in the form prescribed by VENCorp and must be accompanied by the registration fee (if any) fixed by VENCorp from time to time.

(c) VENCorp may from time to time require an Intending Participant to satisfy VENCorp that it continues to meet the criteria for registration in clause 2.5(a) and if the Intending Participant is unable to satisfy VENCorp that it remains entitled to be registered as an Intending Participant, then VENCorp must send written notice to the relevant Intending Participant to advise the relevant Intending Participant that it will cease to be registered as an Intending Participant on the date specified by VENCorp in that notice.

(d) An Intending Participant is taken to be an Intending Participant only insofar as its activities relate to its intention to commence an activity that would entitle or require that person to be registered as a Participant.

(e) An Intending Participant acquires the rights and obligations under these Rules:

(1) which are applicable to Participants; and

(2) which are applicable to the category of Participant (as specified in clauses 2.1(a), (b) and (c)) in which that Intending Participant would be entitled or required to be registered once it commences its intended activities.

2.6 MARKET FEES

(a) VENCorp may charge, and Participants must pay, market fees in accordance with this clause 2.6.

(b) Subject to clauses 2.6(d) to (h), market fees, which are charged for tariffed VENCorp services must be determined by the Board of Directors of VENCorp, and approved by the Regulator, in respect of each financial year in accordance with the Tariff Order.



(c) Unless otherwise approved by the Regulator, each Participant must pay to VENCorp market fees in accordance with this clause 2.6(c):

(1) each Market Participant must pay a registration fee determined in accordance with the Tariff Order for every day or part of a day during which that Market Participant is registered under clause 2.1;

(2) each Market Participant who withdraws gas from the transmission system on a gas day at a system withdrawal point or injects gas into the transmission system on a gas day at a system injection point must pay, in respect of that withdrawal or injection, a metering fee associated with a “transmission supply point” as defined in the Tariff Order and as determined in accordance with the Tariff Order;

(3) each Retailer whose Customers have withdrawn gas on a gas day at a transmission delivery point at which there is a meter from which VENCorp is responsible for collecting metering data must pay, in respect of each such withdrawal on that gas day, a metering fee associated with a “transmission supply point” as defined in the Tariff Order and as determined in accordance with the Tariff Order;

(4) each Retailer whose Customers have withdrawn gas on a gas day at a distribution delivery point at which there is a meter from which VENCorp is responsible for collecting metering data must pay, in respect of each such withdrawal on that gas day, a metering fee associated with a “distribution supply point” as defined in the Tariff Order and as determined in accordance with the Tariff Order;

(5) each Distribution Customer who is a Market Participant and who withdraws gas on a gas day at a distribution delivery point at which there is a meter from which VENCorp is responsible for collecting metering data must pay, in respect of that withdrawal on that gas day, a metering fee associated with a “distribution supply point” as defined in the Tariff Order and as determined in accordance with the Tariff Order;

(6) each Retailer who sells gas to Customers who withdraw gas at a tariff V withdrawal point in a financial year must pay a commodity charge determined in accordance with the Tariff Order for each GJ of gas withdrawn by those Customers at such tariff V withdrawal point and sold by that Retailer to those Customers during that financial year;

(7) each Market Customer who withdraws gas at a tariff V withdrawal point must pay a commodity charge determined in accordance with the Tariff Order for each GJ of gas withdrawn by that Market Customer at that tariff V withdrawal point during each financial year;

(8) each Retailer who sells gas to Customers who withdraw gas at a tariff D withdrawal point in a financial year must pay a commodity charge determined in accordance with the Tariff Order for each GJ of gas withdrawn by those Customers at such tariff D withdrawal point and sold by that Retailer to those Customers during that financial year;

(9) each Market Customer who withdraws gas at a tariff D withdrawal point must pay a commodity charge determined in accordance with the Tariff Order for each GJ of gas withdrawn by that Market Customer at that tariff D withdrawal point during each financial year; and

(10) each Market Participant must pay a system security gas storage charge described as a “system security” charge in the Tariff Order and determined in accordance with the Tariff Order, in respect of each GJ of gas withdrawn from the transmission system by that Market Participant.






2.6(c) to be altered as follows:

(c) Unless otherwise approved by the Regulator, each Participant must pay to VENCorp market fees in accordance with this clause 2.6(c):

(1) .......... [remains unchanged]

(2) each Market Participant who withdraws gas from the transmission system on a gas day at a system withdrawal point or injects gas into the transmission system on a gas day at a system injection point must pay, in respect of that withdrawal or injection, a metering fee associated with a “transmission supply point” as defined in the Tariff Order and as determined in accordance with the Tariff Order;

(3) each Retailer whose Customers have withdrawan gas on a gas day at a are connected to a transmission delivery point at which there is a meter metering installation from which VENCorp is responsible for collecting metering data must pay, in respect of each such withdrawal on that gas day, metering installation a metering fee associated with a “transmission supply point” as defined in the Tariff Order and as determined in accordance with the Tariff Order;

(4) each Retailer whose Customers have withdrawan gas on a gas day at a are connected to a distribution delivery point at which there is a meter metering installation from which VENCorp is responsible for collecting metering data must pay, in respect of each such withdrawal on that gas day, metering installation a metering fee associated with a “distribution supply point” as defined in the Tariff Order and as determined in accordance with the Tariff Order;

(5) each Distribution Customer who is a Market Participant and who withdraws gas on a gas day at a is connected to a distribution delivery point at which there is a meter metering installation from which VENCorp is responsible for collecting metering data must pay, in respect fo of that withdrawal on that gas day metering installation, a metering fee associated with a “distribution supply point” as defined in the Tariff Order and as determined in accordance with the Tariff Order;

(5a) with the exception of data provided to VENCorp for settlement in accordance with the Retail Gas Market Rules, where gas quantities are provided to VENCorp by an Allocation Agent or otherwise derived by VENCorp for the purpose of settlement, the Market Participant for which the information is required shall be deemed to have a metering installation for the purpose of this clause 2.6.

(6) to (10) ....... [remain unchanged]

(d) VENCorp must, before submitting its annual statement to the Regulator for approval in accordance with clause 6.1(a)(2) of the Tariff Order, produce an initial report setting out:

(1) VENCorp’s budgeted expenditures and budgeted revenues for that regulatory year;

(2) the amount of proposed market fees in respect of each of the tariffed VENCorp services in respect of which market fees are proposed to be charged for the next financial year;

(3) the method used in determining the amount of proposed market fees in respect of each of VENCorp’s activities referred to in clause 2.6(d)(2) including but not limited to VENCorp’s estimated costs and expenses associated with those activities;

(4) other fee structures and fee amounts which are appropriate for comparison purposes; and



(5) an assessment of the extent to which the proposed market fees comply with the principles set out in clause 8.1 of the Access Code.

(e) VENCorp must provide a copy of the initial report to:



(f) VENCorp must invite Participants and interested persons to make submissions in relation to the initial report and must consider any such submissions received up to ten business days after the initial report is made available to Participants and interested persons under clause 2.6(e)(2).

(g) VENCorp must prepare a final report which summarises:

(1) submissions received under clause 2.6(f); and

(2) the process of consultation undertaken by VENCorp in relation to preparation of the final report.

(h) VENCorp must provide a copy of the final report to the Regulator at the time of submitting its annual statement to the Regulator for approval in accordance with clause 6.1(a)(2) of the Tariff Order.

2.7 PREVIOUS FINANCIAL YEAR REPORT

(a) VENCorp must, by no later than two months after the end of each financial year, prepare a report setting out:

(1) VENCorp’s budgeted and actual expenditures and budgeted and actual revenues in respect of each of the tariffed VENCorp services, including, but not limited to:

(A) system security;

(B) collection, storage and processing of metering data and billing and settlement of market transactions; and

(C) costs of operating the dispute resolution process under clause 7.2;

(2) an explanation of any significant variation between budgeted and actual expenditures and budgeted and actual revenues; and

(3) contributions made to and payments made from the participant compensation fund,

in respect of the previous financial year.(b) VENCorp must provide a copy of the report prepared under clause 2.7(a) to:

(1) the Regulator on completion; and




CHAPTER 3. MARKET OPERATION AND ADMINISTRATION



3.1 GAS SCHEDULING

3.1.1 Gas scheduling(a) VENCorp must operate the transmission system in accordance with the gas scheduling

procedures and these Rules and by scheduling injections of gas into and withdrawals of gas from the transmission system in accordance with nominations and inc/dec offers.

(b) When scheduling injections of gas into and withdrawals of gas from the transmission system, VENCorp must use its reasonable endeavours to operate within the system security guidelines.

(c) Subject always to:

(1) VENCorp’s obligations under these Rules to schedule injections of gas into, and withdrawals of gas from, the transmission system in accordance with the gas scheduling procedures;

(2) VENCorp’s obligations under these Rules to operate the transmission system within the system security guidelines and to avert threats to system security; and

(3) there being sufficient gas available at all relevant times for injection into the transmission system to satisfy demand,

VENCorp must use its reasonable endeavours to ensure that sufficient gas is made available for withdrawal from the transmission system during each gas day to satisfy Market Participants’ aggregate requirements for gas at system withdrawal points.

(d) VENCorp must develop, document and make available to all Market Participants and Transmission Pipeline Owners the procedures (the gas scheduling procedures), including systems back-up and disaster recovery procedures, which VENCorp will follow, and the algorithm which will be used by VENCorp, for the purpose of scheduling in accordance with this clause 3.1.

3.1.2 Nominations and inc/dec offers(a) Each Market Participant who intends to inject quantities of gas into or withdraw quantities

of gas from the transmission system on a gas day must submit nominations to VENCorp in accordance with and at the times specified in clauses 3.1.3, 3.1.4 and 3.1.7.

(b) A Market Participant who is willing to modify the quantities of gas which it intends to inject into or withdraw from the transmission system on a gas day (as specified in the nominations submitted by that Market Participant in respect of that gas day) may submit inc/dec offers in accordance with clauses 3.1.5 and 3.1.7.

3.1.3 Injection nominations(a) A Market Participant must submit a separate injection nomination in respect of each

system injection point at which it intends to inject gas on a gas day.

(b) Each injection nomination must specify:

(1) the gas day in respect of which the injection nomination applies;

(2) the identity of the Market Participant submitting the injection nomination;(3) the system injection point at which the Market Participant submitting the injection

nomination intends to inject quantities of gas; and

(4) the quantity of gas nominated for injection at that system injection point for that gas day.



3.1.4 Withdrawal nominations(a) A Market Participant must submit a separate withdrawal nomination in respect of each

system withdrawal point from which it intends to withdraw gas on a gas day.

(b) Each withdrawal nomination must specify:

(1) the gas day in respect of which the withdrawal nomination applies;

(2) the identity of the Market Participant submitting the withdrawal nomination;

(3) the system withdrawal point from which the Market Participant submitting the withdrawal nomination proposes to withdraw quantities of gas;

(4) if the Market Participant intends to submit a withdrawal inc/dec offer in respect of that system withdrawal point for that gas day, the controllable quantity nominated by the Market Participant in respect of that system withdrawal point; and

(5) the quantity of gas nominated for withdrawal at that system withdrawal point for each hour of that gas day.

3.1.5 Inc/dec offers(a) Market Participants may make offers (inc/dec offers) to modify the quantities of gas which

they will inject into, or withdraw from, the transmission system on a gas day at specified prices in accordance with this clause 3.1.5.

(b) An inc/dec offer must specify:

(1) the identity of the Market Participant by whom it is made;

(2) the gas day to which the offer relates;

(3) the system injection point (in the case of an injection inc/dec offer) or system withdrawal point (in the case of a withdrawal inc/dec offer) in relation to which the offer is made; and

(4) up to ten price steps.

(c) Each price step must specify:

(1) a single price, expressed in $/GJ to four decimal places, which is to apply throughout the gas day; and

(2) for of the gas day, the total quantity of gas, expressed in GJ, up to which the Market Participant is offering to inject gas into, or withdraw gas from, the transmission system at the price specified in clause 3.1.5(c)(1).

(d) In the case of an injection inc/dec offer, the quantity of gas specified in a price step (referred to in this clause as the “higher price step”) must not be less than the quantity of gas specified in any price step which specifies a price which is less than the price specified in the higher price step.

(e) In the case of withdrawal inc/dec offer, the quantity of gas specified in a price step (referred to in this clause as the “higher price step”) must not be greater than the quantity of gas specified in any price step which specifies a price which is less than the price specified in the higher price step.

(f) Inc/dec offers may specify the following conditions or constraints, which will be applied by VENCorp in scheduling price steps:

[Sub-clauses 3.1.5(1), (2) and (3) deleted: Order in Council, 10 March 1999, published in the Government Gazette 11 March 99]



(4) in the case of an injection inc/dec offer, the minimum quantity of gas which the Market Participant is offering to inject in the gas day to which the offer relates;

(5) in the case of an injection inc/dec offer, the maximum quantity of gas in each price step which the Market Participant is offering to inject in the gas day to which the offer relates;

(5A) in the case of a withdrawal inc/dec offer, the minimum quantity of gas which the Market Participant is offering to withdraw in each hour of the gas day to which the offer relates;

(6) in the case of a withdrawal inc/dec offer, the maximum quantity of gas in each price step which the Market Participant is offering to withdraw in the gas day to which the offer relates; and

(7) in the case of a withdrawal inc/dec offer, the minimum quantity of gas which the Market Participant is offering to withdraw in the gas day to which the offer relates.

[Sub-clause 3.1.5(8) deleted: Order in Council, 10 March 1999, published in the Government Gazette 11 March 99]

(fa) A Market Participant must not submit inc/dec offers that are inconsistent with the conditions or constraints applicable to that Market Participant’s accreditation under clause 3.1.6 unless that Market Participant receives prior consent from VENCorp to do so.

(g) A Market Participant may only make a withdrawal inc/dec offer in respect of a system withdrawal point on a gas day if and to the extent that it has:

(1) nominated a controllable quantity for that system withdrawal point on that gas day; and

(2) registered with VENCorp a maximum controllable quantity in respect of that system withdrawal point in accordance with clause 3.1.6 equal to or in excess of the controllable quantity nominated by that Market Participant for that system withdrawal point on that gas day.

3.1.6 Accreditation of controllable quantities(a) A Market Participant who wishes to:

(1) submit withdrawal inc/dec offers in respect of a system withdrawal point; or

(2) submit injection inc/dec offers in respect of a system injection point; and

(3) receive any ancillary payments resulting from the scheduling of those inc/dec offers,

must apply to VENCorp for accreditation of the controllable quantities in respect of which the Market Participant intends to submit those inc/dec offers.

(b) An application for accreditation by a Market Participant of a controllable quantity in respect of a withdrawal inc/dec offer must specify:

(1) the delivery point to which the application relates;

(2) details of the load characteristics of the controllable quantity at the delivery point, including:

(A) maximum hourly quantities of gas to be withdrawn at that delivery point;



(B) minimum and maximum daily quantities of gas to be withdrawn at that delivery point for the purposes of application by VENCorp in planning and operational studies of the transmission system;

(C) maximum hourly rates of change of gas flow rates;

(D) any conditions relevant to the withdrawal inc/dec offer including but not limited to the period of time required by the Market Participant after the Market Participant receives a scheduling instruction in respect of the offer before the Market Participant will be able to modify the gas flow rate at the relevant system point in accordance with the offer and a time by which VENCorp must issue a scheduling instruction in respect of the offer if it is intended that the Market Participant will modify its gas flow rate; and

(E) such other information as VENCorp may require; and

(3) the specific actions that will be taken to increase or decrease withdrawals at the relevant delivery point when the applicable withdrawal inc/dec offer is scheduled by VENCorp and the methods which will be used to verify that those actions have been taken.

(ba) An application for accreditation by a Market Participant of a controllable quantity in respect of an injection inc/dec offer must specify:

(1) the system injection point to which the application relates;

(2) details of the injection characteristics of the controllable quantity at the system injection point, including:

(A) minimum and maximum hourly quantity of gas to be injected at that delivery point;

(B) maximum hourly rates of change of gas flow rates;

(C) any conditions relevant to the injection inc/dec offer including but not limited to the period of time required by the Market Participant after the Market Participant receives a scheduling instruction in respect of the offer before the Market Participant will be able to modify the gas flow rate at the relevant system point in accordance with the offer and a time by which VENCorp must issue a scheduling instruction in respect of the offer if it is intended that the Market Participant will modify its gas flow rate;

(D) and such other information as VENCorp may require; and

(3) the specific actions that will be taken to increase or decrease injections at the relevant system injection point when the applicable injection inc/dec offer is scheduled by VENCorp.

(c) VENCorp will accredit controllable quantities if: (1) the Market Participant seeking accreditation is able to demonstrate to VENCorp’s

reasonable satisfaction that it will be able to procure that the gas flow at the relevant connection point will be modified in accordance with any scheduling instructions issued by VENCorp in respect of such controllable quantities and that compliance with such scheduling instructions can be monitored and/or audited in a manner acceptable to VENCorp; and

(2) in the case where more than one Market Participant is injecting or withdrawing quantities of gas at a connection point, the application for accreditation of the controllable quantity is consistent with the requirements for delivery or receipt of gas at the relevant connection point.



3.1.7 Timing of nominations and inc/dec offers(a) Each Market Participant must submit nominations in respect of each gas day to VENCorp

by no later than 11.00 am (Local Melbourne Time) on the day which is two days prior to the day on which that gas day starts.

(b) A Market Participant must submit a nomination in respect of a gas day to VENCorp by no later than:

(1) 8.30 am (Local Melbourne Time) on the day before the day on which that gas day starts; and

(2) 8.00 am (Local Melbourne Time) on the same day as the start of that gas day,

if the immediately preceding nomination (including a nomination made pursuant to this clause 3.1.7(b)) made by that Market Participant in respect of the same system point no longer represents that Market Participant’s best estimate of the quantity of gas which it expects to inject into or withdraw from the transmission system at that system point or the timing or gas flow rate of that injection or withdrawal.

(c) Subject to clause 3.1.7(d), a Market Participant may submit inc/dec offers in respect of a gas day at any time prior to, but not later than, 8.00am (Local Melbourne Time) on the same day as the start of the gas day in respect of which they are made.

(d) A Market Participant who intends to submit inc/dec offers in respect of a gas day must submit inc/dec offers which reflect the Market Participant’s best estimate of the quantities and prices which it expects to include in the final inc/dec offers which it intends to submit for that gas day by no later than:

(1) 11.00 am (Local Melbourne Time) on the day which is two days prior to the day on which that gas day starts; and

(2) 8.30 am (Local Melbourne Time) on the day before the day on which that gas day starts.

Clause 3.1.8 deleted by notice in the Government Gazette dated 28 February 2002.

3.1.9 Confirmation of nominations and inc/dec offers (a) Each Market Participant is responsible for verifying that the information posted on the market

information bulletin board relating to its nominations and inc/dec offers is accurate and correct.

(b) VENCorp is under no obligation to verify that the information posted on the market information bulletin board relating to a Market Participant’s nominations or inc/dec offers is accurate and correct.

(c) VENCorp must provide acknowledgment of receipt of and, subject to clause 3.1.9(b), validate all nominations or inc/dec offers submitted by Market Participants in accordance with the electronic communication procedures.

(d) VENCorp must ensure that the information relating to each Market Participant’s nominations or inc/dec offers posted on the market information bulletin board is used for the purposes of scheduling, pricing and settlement in accordance with these Rules.

(e) If a nomination or an inc/dec offer is invalid (as determined by VENCorp in accordance with the electronic communication procedures), VENCorp must not schedule that nomination or inc/dec offer and must, as soon as reasonably practicable after it becomes aware of the invalidity of the nomination or inc/dec offer, notify the Market Participant who has submitted



the nomination or inc/dec offer of its invalidity.

3.1.10 Other nomination and inc/dec offer requirements(a) Market Participants must submit their nominations and inc/dec offers to VENCorp in

accordance with the electronic communication procedures, unless otherwise determined by VENCorp.

(b) A nomination submitted by a Market Participant in respect of a system point for a gas day will be deemed to be revoked by a subsequent nomination submitted by that Market Participant in respect of that same system point and that same gas day.

(c) An inc/dec offer submitted by a Market Participant in respect of a system point for a gas day will be deemed to be revoked by a subsequent inc/dec offer submitted by that Market Participant in respect of that same system point and that same gas day.

Clause 3.1.10(d) deleted by notice in the Government Gazette dated 28 February 2002

(e) A Market Participant may submit, vary and revoke standing nominations and standing inc/dec offers, provided that it does so in accordance with the electronic communication procedures.

(f) Each Market Participant warrants to VENCorp that:

(1) each injection nomination submitted by that Market Participant will be made in good faith and represent that Market Participant’s best estimate of the quantities of gas which it expects to inject into the transmission system at the relevant system injection point on the relevant gas day and the timing of such injections (unless instructed by VENCorp to do otherwise);

(2) each withdrawal nomination submitted by that Market Participant will be made in good faith and represent that Market Participant’s best estimate of the quantities of gas which it expects to withdraw from the transmission system at the relevant system withdrawal zone on the relevant gas day and the timing of such withdrawals (unless instructed by VENCorp to do otherwise); and

(3) if scheduled to do so by VENCorp, it will be able to modify the quantities of gas which it injects into, or withdraws from, the transmission system on a gas day in accordance with the inc/dec offers submitted by that Market Participant in respect of that gas day.

(g) To avoid doubt, the aggregate quantities of gas (if any) which a Market Participant nominates for injection into the transmission system on a gas day need not be equal to the aggregate quantities of gas (if any) which that Market Participant nominates for withdrawal from the transmission system on that gas day.

(h) A Market Participant who knows or believes that it will not, or that it is unlikely to be able to, comply in any material respect with the injections or withdrawals scheduled for that Market Participant in a final operating schedule must immediately notify VENCorp of that fact and the extent of the known or likely non-compliance.

(i) The acceptance or scheduling of a nomination or an inc/dec offer by VENCorp, or the failure by VENCorp to reject a nomination or an inc/dec offer, will not constitute an offer or undertaking by VENCorp to receive, convey or deliver any quantity of gas.



3.1.11 Priority of inc/dec offersIf the information provided in inc/dec offers implies that two or more inc/dec offers are equally beneficial for scheduling, then VENCorp must schedule those offers in accordance with the following principles:

(a) an injection inc/dec offer should be scheduled before a withdrawal inc/dec offer;(b) where two or more injection inc/dec offers are equally beneficial, those injection inc/dec

offers should be scheduled as far as practicable to the same extent; and

(c) where two or more withdrawal inc/dec offers are equally beneficial, those withdrawal inc/dec offers should be scheduled as far as practicable to the same extent.

3.1.12 Preliminary and final operating schedules(a) VENCorp must use the following inputs and assumptions for the purpose of producing

preliminary operating schedules and final operating schedules for a gas day:

(1) the nominations and inc/dec offers submitted by Market Participants in respect of that gas day, including any conditions or constraints included in such inc/dec offers in accordance with clause 3.1.5(f);

(1A) any conditions or constraints applicable to the inc/dec offers of Market Participants and delivery or receipt of gas at the relevant connection point accredited under the accreditation process under clause 3.1.6;

(2) VENCorp’s demand projections by location for that gas day including any margin for system security, as determined in accordance with the gas scheduling procedures;

(3) the linepack required by VENCorp in respect of that gas day;

(4) any equations or constraints relating to the flow of gas in the transmission system, including without limitation mass, gas flow and minimum and maximum operating pressures;

(5) in the case of operating schedules produced in respect of a gas day prior to that gas day, the forecast condition of the flow of gas in the transmission system at the start of that gas day, including without limitation mass, operating pressures and quantity and distribution of linepack;

(6) in the case of final operating schedules produced in respect of a gas day on that gas day, the actual condition of the flow of gas in the transmission system, including without limitation mass, operating pressures and quantity and distribution of linepack;

(7) the actual or forecast state or condition of the pipelines and pipeline equipment which constitute the transmission system; and

(8) any other inputs or assumptions specified for that purpose in the gas scheduling procedures.

(b) The inputs and assumptions set out in clause 3.1.12(a) are to be applied by VENCorp in an optimisation program in which nominations and inc/dec offers submitted by Market Participants are used to produce preliminary operating schedules and final operating schedules which specify injections and withdrawals for each hour of the gas day in a way that minimises the cost of satisfying demand for gas over that gas day taking account of any transmission constraints affecting the transmission or storage of gas in the transmission system during that gas day.

(c) Each day VENCorp must publish:



(1) by 1.00 pm (Local Melbourne Time), a preliminary operating schedule covering each hour in the gas day starting on the second day after the current day;

(2) by 10.00 am (Local Melbourne Time), a preliminary operating schedule covering each hour in the gas day starting on the day after the current day; and

(3) as soon as reasonably practicable and in any event by 9.00 am (Local Melbourne Time), a final operating schedule covering each hour in the gas day starting on the current day.

(d) If, after a preliminary operating schedule or a final operating schedule has been published, a change in circumstances occurs which VENCorp considers is likely to have a material effect on the operation of the transmission system on the gas day in respect of which such schedule is made, VENCorp must publish a further preliminary operating schedule or final operating schedule (as the case may be) in respect of that gas day as soon as reasonably practicable.

(e) Each preliminary operating schedule and final operating schedule must include the information set out in clause 5.1.4(b).

(f) All material factors which VENCorp takes into account for the purposes of preparing a preliminary operating schedule or a final operating schedule must be recorded by VENCorp so that the gas scheduling procedures can be properly audited.

(g) VENCorp must maintain records relating to the scheduling process undertaken by VENCorp in respect of each gas day and make those records available to any Market Participant, subject to the Market Participant paying the reasonable costs incurred by VENCorp in making those records available.

(h) VENCorp must issue scheduling instructions to each Market Participant by no later than 9.00 am (Local Melbourne Time) on each day, specifying the quantities of gas which each Market Participant is scheduled to inject or withdraw for each hour of the gas day commencing on that day at each injection point and withdrawal zone.

(i) VENCorp may make changes to the final operating schedule by issuing scheduling instructions during the gas day in accordance with the gas scheduling procedures.

(j) VENCorp must ensure that all scheduling instructions and the times at which they are issued are automatically logged electronically or otherwise recorded.

3.1.13 Failure to conform to scheduling instructions(a) Subject to clauses 3.1.13(b) and (d), if VENCorp issues a scheduling instruction in respect

of an injection nomination or an inc/dec offer, the Market Participant who submitted the injection nomination or the inc/dec offer must comply with the scheduling instruction in all material respects.

(b) If a Market Participant is unable to comply in all material respects with a scheduling instruction issued in respect of an injection nomination or an inc/dec offer, it must:

(1) notify VENCorp that it is unable to comply with the scheduling instruction as soon as practicable after it becomes aware of its failure to comply and give the reasons for the failure; and

(2) provide VENCorp with such evidence of the reasons for the failure as VENCorp may reasonably require.

(c) If a Market Participant is unable to comply in all material respects with a scheduling instruction issued in respect of an injection nomination or an inc/dec offer, VENCorp must notify all Market Participants of that fact and VENCorp must, on request, provide details of



the reasons for the failure to comply if and to the extent that those reasons have been provided.

(d) A Market Participant is not obliged to comply with a scheduling instruction issued in respect of an injection nomination or an inc/dec offer if it is unable to do so:

(1) due to a technical fault or failure which, in the opinion of VENCorp, was outside that Market Participant’s control; or

(2) in the case of an injection nomination or an injection inc/dec offer, because the Market Participant ordered a quantity of gas from a Producer or other person to enable it to comply with that injection nomination or injection inc/dec offer and that Producer or other person was only required, under the terms of its contract with that Market Participant, to use its reasonable endeavours to deliver that quantity of gas and that Producer or other person does not in fact deliver that quantity of gas.

(e) Subject to clauses 3.1.13(b) and (d), if a Market Participant fails to comply in any material respect (as determined by VENCorp in its reasonable opinion) with a scheduling instruction issued in respect of an injection nomination or an inc/dec offer, then:

(1) the gas injection or gas withdrawal which is the subject of that scheduling instruction must be declared by VENCorp to be non-conforming; and

(2) the relevant Market Participant may be liable to pay financial penalties or other sanctions imposed under the Gas Industry Act for breach of these Rules.

(f) If a gas injection or gas withdrawal which is the subject of a scheduling instruction issued in respect of an injection nomination or an inc/dec offer is declared by VENCorp to be non-conforming in accordance with clause 3.1.13(e):

(1) VENCorp must notify the relevant Market Participant that the gas injection or gas withdrawal does not conform and request a reason for the Market Participant’s failure to comply with the scheduling instruction; and

(2) if the relevant Market Participant fails to respond to the request set out in clause 3.1.13(f)(1) or if VENCorp is not satisfied that the relevant Market Participant will respond to any future scheduling instruction, VENCorp may intervene by issuing directions or requiring the Market Participant to take action in accordance with clause 6.6 (which intervention may include requiring the Market Participant to inject or withdraw gas at a constant rate).

(g) Until a Market Participant responds to a request under clause 3.1.13(f)(1) and VENCorp is satisfied that the Market Participant will respond to future scheduling instructions, the gas injection or gas withdrawal which is the subject of the relevant injection nomination or inc/dec offer will continue to be non-conforming.

3.1.14 Scheduling errors(a) If either:

(1) the dispute resolution panel determines under clause 7.2 that VENCorp has failed to follow the gas scheduling procedures for the purpose of issuing scheduling instructions; or

(2) VENCorp declares that it has not complied with the gas scheduling procedures for the purpose of issuing scheduling instructions,

a scheduling error will be deemed to have occurred and a Market Participant may be entitled to compensation in accordance with clause 3.3.3.

(b) Market prices are not to be adjusted when a scheduling error is deemed to have occurred.



3.1.15 Injection and withdrawal confirmations(a) Each Participant who is registered as a Producer or a Storage Provider under clause

2.1(a) must by no later than 4.00 pm on each day notify VENCorp of the total quantity of gas that it intends to inject into, and withdraw from, the transmission system on its own account (if any) and on behalf of Market Participants during the gas day commencing on the following day.

(b) If, for any reason, there is a material change to the quantity of gas previously notified by a Participant under this clause 3.1.15, then the Participant must promptly notify VENCorp of the change.

3.1.16 Title to gas(a) Until such time as title to gas injected by a Market Participant is transferred to another

Market Participant or to the Market Participants as owners in common in accordance with clause 3.1.16(b), title to gas injected into the transmission system shall at all times remain with the Market Participant which injected such gas or, if a Market Participant has injected gas, or arranged for gas to be injected, into the transmission system as agent, the principal on whose behalf such gas was injected.

(b) VENCorp must establish rules for determining ownership of gas in the transmission system and the times and places at which title to gas is transferred between Market Participants as a result of transactions in gas effected in accordance with these Rules.

(c) In the event of a dispute between Participants relating to the ownership of gas in the transmission system, VENCorp must determine the dispute in accordance with the rules established pursuant to clause 3.1.16(b) and any such determination shall be binding on all Participants.

(d) Each Market Participant warrants to VENCorp that:

(1) it will have title to all gas injected into, or tendered for injection into, the transmission system by it at any system injection point or, where the Market Participant is acting as agent in respect of a quantity of gas so injected, it will be unconditionally and irrevocably authorised to transfer title to such gas to such person as VENCorp may determine in accordance with these Rules; and

(2) all such gas will (at the system injection point) be free of any lien, charge or encumbrance or adverse claim (as to title or otherwise), including any claim for any tax, royalty or other charge in respect of the production, gathering, processing and tendering of gas arising on or before injection of gas into the transmission system.

(e) Each Market Participant unconditionally and irrevocably authorises VENCorp to effect any transfer of title to gas injected by it into the transmission system and to determine the time and place of transfer and the quantities of gas transferred in accordance with these Rules.

(f) Each Market Participant must indemnify VENCorp and hold it harmless against any loss, liability, damage, claim, action, proceeding, cost and expense suffered or incurred by or made or brought against VENCorp in consequence of any breach of the warranties in clause 3.1.16(d).

(g) VENCorp makes no warranty regarding the merchantability or suitability for any purpose of gas delivered at a system withdrawal point and all implied warranties are excluded to the maximum extent permitted by law.

(h) Custody and control, and risk of loss, of gas injected into the transmission system at a system injection point shall pass to VENCorp.



(i) Custody and control, and risk of loss, of gas withdrawn from the transmission system at a system withdrawal point shall pass to the Market Participant who has title to that gas at that system withdrawal point immediately prior to such withdrawal or, where a Market Participant has injected gas as agent for a third party, to the Market Participant whose principal has title to gas at that system withdrawal point immediately prior to such withdrawal.

(j) VENCorp has the right to co-mingle a Market Participant’s gas with other gas in the transmission system.

(k) Each Market Participant acknowledges and accepts that the gas delivered to it at a system withdrawal point may not match the specifications of the gas injected, or tendered for injection, into the transmission system by that Market Participant at a system injection point.



3.2 DETERMINATION OF MARKET PRICE

3.2.1 Determination of market price(a) The market price for each trading interval and each pricing zone is to be determined by

VENCorp in accordance with this clause 3.2.

(b) After the end of each gas day, VENCorp must produce a pricing schedule in accordance with clause 3.2.1(e) for the purpose of determining the market price for each pricing zone and each trading interval for that gas day.

(c) VENCorp must use the following inputs for the purpose of producing the pricing schedule for a gas day and for the purpose of doing so, VENCorp is to assume that there are no transmission constraints affecting the transportation or storage of gas in the transmission system during that gas day:

(1) valid nominations and valid inc/dec offers submitted by the Market Participant in respect of that gas day;

(2) the actual market demand (as defined in clause 3.2.1(d)) in respect of that gas day;

(3) the actual quantities of gas injected into the transmission system in respect of that gas day;

Sub-clauses 3.2.1(c)(4), 3.2.1(c)(5) and, 3.2.1(c)(6) deleted by notice in the Government Gazette dated 28 February 2002.

and any other inputs or assumptions specified for that purpose in the gas scheduling procedures.

(d) For the purpose of clause 3.2.1(c), the “actual market demand” means, in respect of each hour of the gas day, the sum of:

(1) the total quantity of gas withdrawn from the transmission system in that hour of the gas day as determined in accordance with clause 4.4 less the total quantity of gas withdrawn in that hour of the gas day at a delivery point in respect of which accreditation has been given by VENCorp under clause 3.1.6 and in respect of which a withdrawal inc/dec offer has been submitted; plus

(2) the maximum quantity of gas withdrawals specified (whether or not such gas is actually withdrawn) in valid withdrawal inc/dec offers submitted in respect of that hour of the gas day by Market Participants who are accredited by VENCorp under clause 3.1.6; plus

(3) the amount (which amount may be less than zero) by which the total quantity of gas injected into the transmission system in that hour of the gas day determined in accordance with clause 4.4 is less than the total quantity of gas scheduled to be injected into the transmission system in accordance with scheduling instructions issued by VENCorp; plus

(4) the security margin for that gas day as determined in accordance with the gas scheduling procedures.

(e) The inputs and assumptions set out in clause 3.2.1(c) are to be applied by VENCorp in an optimisation program in which nominations and inc/dec offers submitted by Market Participants are used to produce a pricing schedule which specifies injections and withdrawals of gas to be made in each trading interval and each pricing zone in a way



which minimises the cost of satisfying the actual market demand for gas (as defined under clause 3.2.1(d)) in that trading interval and for the purpose of doing so, VENCorp is to assume that there are no transmission constraints affecting the transportation or storage of gas in the transmission system during that gas day.

(f) The pricing schedule for a gas day will determine:

(1) the market price for each pricing zone for that gas day;

(2) the quantity of gas that each Market Participant would have been scheduled to inject and/or withdraw in each hour of the gas day on the basis of the inputs and assumptions applied under clause 3.2.1(c).

Sub-clauses 3.2.1(f)(3) and 3.2.1(f)(4) deleted by notice in the Government Gazette dated 28 February 2002.

(g) VENCorp must publish the market price in accordance with clause 5.1.4(e).

(h) For the avoidance of doubt, the market price as determined and published by VENCorp in accordance with these Rules is GST-exclusive, that is, not including amounts in respect of GST. Amounts payable under these Rules will, however, be subject to the addition of GST, where applicable, under clause 3.8.

3.2.2 Pricing in the event of force majeure event or suspension of the market(a) Subject to clause 3.2.2(c), in the event of a force majeure event or if VENCorp has

suspended the market under clause 6.7.3, VENCorp must, if and to the extent that VENCorp considers it reasonably possible to do so, use:

(1) the gas scheduling procedures; and

(2) the pricing schedule,

to determine the market price in each pricing zone and for each trading interval during which that force majeure event or suspension continues.

(b) If VENCorp reasonably considers that it is unable to properly determine the market price under clause 3.2.2(a), VENCorp must, subject to clause 3.2.2(c), determine the market price for that trading interval and pricing zone using any other available knowledge and information that VENCorp considers to be relevant and reasonable, including but not limited to any forecast prices most recently published under clause 5.1.4 in relation to that trading interval.

(c) If VENCorp determines the market price under clause 3.2.2(a) or (b):

(1) it must do so in accordance with this clause 3.2, if and to the extent that VENCorp considers it reasonably possible to do so; and

(2) the market price must not exceed the administered price cap.

3.2.3 Failure of scheduling software/systems(a) Subject to clause 3.2.3(c), if:

(1) there is no force majeure event and/or the market has not been suspended in a trading interval and a pricing zone; and

(2) VENCorp is unable to determine the market price in respect of that trading interval and pricing zone in accordance with this clause 3.2 as a result of a failure of scheduling software or systems or for any other reason,



VENCorp must, if and to the extent VENCorp considers it reasonably possible to do so, use:

(3) the gas scheduling procedures; and

(4) the pricing schedule,

to determine the market price for that trading interval and that pricing zone in respect of which VENCorp is unable to determine the market price in accordance with this clause 3.2.

(b) If VENCorp reasonably considers that it is unable to properly determine the market price under clause 3.2.3(a) for a trading interval and pricing zone during which VENCorp is otherwise unable to determine the market price in accordance with this clause 3.2, VENCorp must, subject to clause 3.2.3(c), determine the market price for that trading interval and pricing zone using any other available knowledge and information that VENCorp considers to be relevant and reasonable, including but not limited to any forecast prices most recently published under clause 5.1.4 in relation to that trading interval.

(c) If VENCorp determines the market price under clause 3.2.3(a) or (b),

(1) it must do so in accordance with this clause 3.2, if and to the extent that VENCorp considers it reasonably possible to do so; and

(2) the market price must not exceed the administered price cap.

3.2.4 VoLL(a) If hourly injections and withdrawals of gas as determined under clause 3.2.1(f)(2) imply

that curtailment would have occurred in a pricing zone in a trading interval (whether or not curtailment actually occurs) the market price for that pricing zone and that trading interval is VoLL.

(b) Subject to clause 3.2.4(e), the value of VoLL is $800/GJ.

Clause 3.2.4(c) deleted by notice in the Government Gazette dated 28 February 2002.

(d) VENCorp must undertake a review of VoLL in accordance with this clause 3.2.4 at intervals not exceeding five years from the last review in accordance with this clause 3.2.4.

(e) If VENCorp determines that the value of VoLL should be changed as a result of the reviews referred to in clause 3.2.4(d), VENCorp must propose that the value of VoLL be changed in accordance with the rule change procedures in chapter 8.

(f) Any change to the value of VoLL must take effect within six months of the date on which the notice of the change is published in accordance with clause 8.8(b).




3.3 PARTICIPANT COMPENSATION FUND

3.3.1 Establishment of the participant compensation fundVENCorp must establish and maintain a fund to be called the participant compensation fund for the purpose of paying compensation to Market Participants for scheduling errors as determined by the dispute resolution panel.

3.3.2 Funding the participant compensation fund(a) Each year VENCorp must collect from each Market Participant, and each Market

Participant must pay to VENCorp, an amount calculated in accordance with clause 3.3.2(d).

(b) Subject to clause 3.3.2(c), the funding requirement for the participant compensation fund for each financial year until 30 June 2001 is the lesser of:

(1) $500,000; and

(2) $1,000,000 minus the amount which VENCorp reasonably considers will be the balance of the participant compensation fund at the end of the relevant financial year.

(c) The amount of the funding requirement referred to in clause 3.3.2(b) may be varied from time to time by VENCorp in consultation with Market Participants and with the prior written consent of the Regulator.

Sub-clause 3.3.2(c)(2) deleted by notice in the Government Gazette dated 208 Februqary 2002.

(d) VENCorp must, no later than the date of issue of the first preliminary settlement statement in each financial year calculate a contribution rate for contributions to the participant compensation fund which is to apply for that financial year by dividing the funding requirement determined in accordance with clause 3.3.2(b) by VENCorp’s reasonable forecast of the aggregate quantity of gas which it expects all Market Participants will withdraw from the transmission system for the relevant financial year.

(e) VENCorp must, no later than the date of issue of the first preliminary settlement statement in each financial year, publish the funding requirement determined in accordance with clause 3.3.2(b), the contribution rate determined in accordance with clause 3.3.2(d), and the basis on which that funding requirement and that contribution rate have been determined.

(f) Each Market Participant must pay as part of the settlement amount payable by that Market Participant in respect of each settlement period, an amount calculated by multiplying the contribution rate determined in accordance with clause 3.3.2(d) by the aggregate quantity of gas withdrawn from the transmission system by that Market Participant during the relevant settlement period as determined from metering data in accordance with clause 4.4.






3.3.2(f) to be altered as follows:

(f) Each Market Participant must pay as part of the settlement amount payable by that Market Participant in respect of each settlement period, an amount calculated by multiplying the contribution rate determined in accordance with clause 3.3.2(d) by the aggregate quantity of gas withdrawn from the transmission system by that Market Participant during the relevant settlement period as determined from metering data in accordance with clause 4.4.

(g) The component of the settlement amount payable by a Market Participant in respect of the participant compensation fund must be paid into the participant compensation fund.

(h) Participants will not be entitled to a refund of any contributions made to the participant compensation fund.

(i) The participant compensation fund is to be maintained by VENCorp and is the property of VENCorp.

(j) Any interest paid on money held in the participant compensation fund will accrue to and form part of the participant compensation fund.

(k) VENCorp will pay from the participant compensation fund:

(1) all income tax on interest earned by the participant compensation fund;

(2) all bank account debit tax, financial institutions duty and bank fees in relation to the participant compensation fund; and

(3) compensation to Market Participants in accordance with clause 3.3.3.

3.3.3 Dispute Resolution Panel to determine compensationIf a scheduling error has occurred, the dispute resolution panel must determine, subject to clause 3.3.4:

(a) which Market Participants are to receive compensation from the participant compensation fund in respect of that scheduling error; and

(b) the amount of compensation each Market Participant is to receive.

3.3.4 Compensation limitedThe aggregate amount of compensation paid each year from the participant compensation fund must not exceed the balance of the participant compensation fund that would have been available at the end of that year had no compensation payments been made that year and therefore the dispute resolution panel must, when making a determination, take into account:

(a) the balance of the participant compensation fund at the time the determination is being made; and

(b) the possibility that further compensation payments will be required to be made during that year.

3.3.5 Manner and timing of compensation paymentsThe manner and timing of payments from the participant compensation fund will be determined by the dispute resolution panel.

3.3.6 VENCorp and its officers not liableNeither VENCorp nor its officers are liable in respect of a scheduling error, except out of the participant compensation fund as contemplated under this clause 3.3.



Clause 3.4 deleted by notice in the Governement Gazette dated 28 February 2002.



3.5 ALLOCATION AND RECONCILIATION

3.5.1 Daily quantitiesFor the purposes of these Rules, including determining:

(a) trading imbalances under clause 3.6.4; and

(b) market fees under clause 2.6,

the quantity of gas treated as injected into and withdrawn from the transmission system by each Market Participant each gas day shall be determined in accordance with this clause 3.5.

3.5.2 Injection allocations(a) Where gas is injected, or tendered for injection, at a system injection point by more than

one Market Participant, the Market Participants who inject gas, or tender gas for injection, at that system injection point must together appoint a single Allocation Agent to determine the quantity of gas which is to be treated as injected into the transmission system by each of those Market Participants from time to time at that system injection point.

(b) Unless otherwise agreed by VENCorp, a Market Participant must not submit nominations or inc/dec offers in respect of a system injection point to which clause 3.5.2(a) applies or inject, or tender for injection, gas at a system injection point to which clause 3.5.2(a) applies unless:

(1) that Market Participant has appointed the Allocation Agent for that system injection point for the purpose described in clause 3.5.2(a); and

(2) the Allocation Agent for that system injection point has confirmed to VENCorp that it has been appointed by that Market Participant for the purpose described in clause 3.5.2(a),

provided that, notwithstanding any other provision of this clause 3.5, if an Allocation Agent has not been appointed by a Market Participant for a system injection point or such an Allocation Agent has ceased to act in respect of that system injection point for any reason whatsoever, VENCorp may, with the approval of the Regulator, appoint an Allocation Agent for that system injection point and such an appointment shall be deemed to be that of that Market Participant.

(c) Only one Allocation Agent shall be appointed for each system injection point.(d) Each Market Participant must immediately notify VENCorp if an Allocation Agent ceases to

be appointed by it in relation to any system injection point.(e) Each Market Participant who appoints an Allocation Agent must for the term of that

appointment ensure that such Allocation Agent complies with the provisions of this clause 3.5.

(f) If an Allocation Agent does not comply with the provisions of this clause 3.5, VENCorp is not required to have regard to any injection allocation statement submitted by that Allocation Agent and clause 3.5.2(m) will apply for the purpose of allocation.

(g) Each Allocation Agent must, in respect of each system injection point in relation to which it has been appointed, give to VENCorp, not later than the third day after each gas day or such later time as VENCorp may agree with that Allocation Agent, a statement in respect of that gas day specifying:

(1`) the identity of the system injection point;(2) the gas day to which the statement relates;



(3) the identity of each Market Participant which injected gas into the transmission system at that system injection point on that gas day;

(4) the total quantity of gas injected into the transmission system at that system injection point during each trading interval on that gas day; and

(5) the quantity of gas which is to be treated as injected by each Market Participant into the transmission system at that system injection point on each trading interval during that gas day.

(h) The total quantity of gas allocated by each Allocation Agent in respect of a trading interval at a system injection point must equal the total quantity of gas injected into the transmission system during that trading interval at that system injection point (as measured and determined in accordance with clause 4.4).




3.5.2(h) to be altered as follows:

(h) The total quantity of gas allocated by each Allocation Agent in respect of a trading interval at a system injection point must equal the total quantity of gas injected into the transmission system during that trading interval at that system injection point (as measured and determined in accordance with clause 4.4).

(i) Where an injection allocation statement has been submitted by an Allocation Agent which specifies a Market Participant as having injected a quantity of gas into the transmission system at a system injection point on a gas day, that Market Participant may submit to VENCorp, not later than the third day after that gas day or such later time as VENCorp may agree with that Market Participant, a sub-allocation statement specifying:

(1) that such quantity is to be treated as having been injected into the transmission system at that system injection point by one or more Market Participants (who may include the Market Participant specified in the injection allocation statement);

(2) the identity of those Market Participants;

(3) the gas day to which the statement relates; and

(4) the quantity which is to be treated as having been injected by each of those Market Participants.

(j) VENCorp is not required to have regard to any sub-allocation statement unless each Market Participant identified in that sub-allocation statement has confirmed in writing to VENCorp that it has appointed the Sub-allocation Agent for the relevant system injection point for the purposes of clause 3.5.2(i).

(k) VENCorp is entitled to rely on any injection allocation statement or sub-allocation statement which has been submitted by an Allocation Agent or a Sub-allocation Agent for the purposes of determining the quantities of gas treated as injected into the transmission system by all Market Participants who have appointed that Allocation Agent or Sub-allocation Agent.

(l) If:

(1) an Allocation Agent has not been appointed in respect of a system injection point; or



(2) VENCorp is notified by a Market Participant that the appointment of an Allocation Agent in respect of a system injection point has been terminated by that or any other Market Participant,

VENCorp must determine the quantities of gas which are to be treated as injected by Market Participants at that system injection point in accordance with clause 3.5.2(m) and, in the case of paragraph (2) of this clause 3.5.2(l), must disregard any injection allocation statement subsequently given by that Allocation Agent in respect of that system injection point.

(m) If clauses 3.5.2(f) or (l) apply, VENCorp must determine the quantity of gas which is to be treated as having been injected by each Market Participant at the relevant system injection point in accordance with the following formula:

Q = MQ x

Where:

Q is the quantity of gas which is to be treated as having been injected by that Market Participant at that system injection point in a trading interval;

MQ is the actual quantity of gas injected into the transmission system at that system injection point in that trading interval;

SQi is the quantity of gas scheduled by VENCorp for injection by that Market Participant at that system injection point in that trading interval; and

SSQj is the total quantity of gas scheduled by VENCorp for injection by all Market Participants at that system injection point in that trading interval,

provided that VENCorp may, with the approval of the Regulator and on prior notice given to any affected Market Participant, vary the above formula, or use a different formula, in any case where it is established that the application of the above formula, in all the circumstances, affords undue preference to that Market Participant and undue prejudice to other Market Participants and in exercising its discretion under this proviso, VENCorp may, with the approval of the Regulator, have regard to title to gas.




New 3.5.2(ma) to be inserted after 3.5.2(m) as follows:

(ma) Where VENCorp has acted in accordance with clause 3.5.2(m) then VENCorp may recover reasonable costs incurred in applying that clause from those Market Participants to which the application has applied and those Market Participants must pay VENCorp those costs.

(n) An Allocation Agent may be appointed to act in relation to more than one system injection point and may also be appointed to act in relation to one or more system withdrawal points.

3.5.3 Withdrawal allocations - non-SAW pointsMSO Rules Amendments to facilitate Full Retail Contestability:

The following changes/additions to the MSO Rules have been approved by the VENCorp Board of Directors and have



received authorisation under the Trade Practices Act by the ACCC.


Heading to 3.5.3 to be altered as follows:

3.5.3 Withdrawal allocations non-SAW points

(a) Where gas is withdrawn, or tendered for withdrawal, at a non-SAW point by more than one Market Participant and there are insufficient metering installations installed to enable VENCorp to determine the quantity of gas withdrawn at that non-SAW point by each Market Participant, the Market Participants who withdraw gas, or tender gas for withdrawal, at that non-SAW point must together appoint a single Allocation Agent to determine the quantity of gas which is to be treated as withdrawn from the transmission system by each of those Market Participants from time to time at that non-SAW point


The following changes/additions to the MSO Rules have been approved by the VENCorp Board of Directors and have received authorisation under the Trade Practices Act by the ACCC


3.5.3(a) to be altered as follows:.

(a) Where gas is withdrawn, or tendered for withdrawal, at a non-SAW delivery point by more than one Market Participant and there are insufficient metering installations installed to enable VENCorp to determine the quantity of gas withdrawn at that non-SAW delivery point by each Market Participant, the Market Participants who withdraw gas, or tender gas for withdrawal, at that non-SAW delivery point must together appoint a single Allocation Agent to determine the quantity of gas which is to be treated as withdrawn from the transmission system or distribution system by each of those Market Participants from time to time at that non-SAW delivery point.

(b) Unless otherwise agreed by VENCorp, a Market Participant must not submit nominations or inc/dec offers in respect of a non-SAW point to which clause 3.5.3(a) applies or withdraw, or tender for withdrawal, gas at a non-SAW point to which clause 3.5.3(a) applies unless:

(1) that Market Participant has appointed the Allocation Agent for that non-SAW point for the purpose described in clause 3.5.3(a); and

(2) the Allocation Agent for that non-SAW point has confirmed to VENCorp that it has been appointed by that Market Participant for the purpose described in clause 3.5.3(a).




3.5.3(b) to be altered as follows:

(b) Unless otherwise agreed by VENCorp, a Market Participant must not submit nominations or inc/dec offers in respect of a non-SAW delivery point to which clause 3.5.3(a) applies or withdraw, or tender for withdrawal, gas at a non-SAW delivery point to which clause 3.5.3(a) applies unless:

(1) that Market Participant has appointed the Allocation Agent for that non-SAW delivery point for



the purpose described in clause 3.5.3(a); and

(2) the Allocation Agent for that non-SAW delivery point has confirmed to VENCorp that it has been appointed by that Market Participant for the purpose described in clause 3.5.3(a).

(c) Only one Allocation Agent shall be appointed for each non-SAW point.MSO Rules Amendments to facilitate Full Retail Contestability:



3.5.3(c) to be altered as follows:

(c) Only one Allocation Agent shall be appointed for each non-SAW delivery point to which clause 3.5.3(a) applies.

(d) Each Market Participant must immediately notify VENCorp if an Allocation Agent ceases to be appointed by it in relation to any non-SAW point.




3.5.3(d) to be altered as follows:

(d) Each Market Participant must immediately notify VENCorp if an Allocation Agent ceases to be appointed by it in relation to any non-SAW delivery point to which clause 3.5.3(a) applies.

(e) Each Market Participant who appoints an Allocation Agent must ensure for the term of the appointment that such Allocation Agent complies with the provisions of this clause 3.5.

(f) If an Allocation Agent does not comply with the provisions of this clause 3.5, VENCorp is not required to have regard to any withdrawal allocation statement submitted by that Allocation Agent and clause 3.5.3(m) will apply for the purpose of determining allocations.

(g) Each Allocation Agent must, in respect of each non-SAW point in respect of which it has been appointed, give to VENCorp, not later than the third day after each gas day or such later time as VENCorp may agree with that Allocation Agent, a statement in respect of that gas day specifying:

(1) the identity of the non-SAW point;(2) the gas day to which the statement relates;

(3) the identity of each Market Participant which withdraws gas from the transmission system at that non-SAW point on that gas day;

(4) the total quantity of gas withdrawn from the transmission system at that non-SAW point during each trading interval on that gas day; and

(5) the quantity of gas which is to be treated as withdrawn by each Market Participant from the transmission system at that non-SAW point on each trading interval during that gas day.






3.5.3(g) to be altered as follows:

(g) Each Allocation Agent must, in respect of each non-SAW delivery point in respect of which it has been appointed, give to VENCorp, not later than 5:00 p.m. on the third calendar day after each gas day or such later time as VENCorp may agree with that Allocation Agent, a statement in respect of that gas day specifying:

(1) the identity of the non-SAW delivery point;

(2) the gas day to which the statement relates;

(3) the identity of each Market Participant which withdraws gas from the transmission system at that non-SAW delivery point on that gas day;

(4) the total quantity of gas withdrawn from the transmission system at that non-SAW delivery point during each trading interval on that gas day; and

(5) the quantity of gas which is to be treated as withdrawn by each Market Participant from the transmission system at that non-SAW delivery point on each trading interval during that gas day.

(h) The total quantity of gas allocated by each Allocation Agent in respect of a trading interval at a non-SAW point must equal the total quantity of gas withdrawn from the transmission system during that trading interval at that non-SAW point (as measured and determined in accordance with clause 4.4).




3.5.3(h) to be altered as follows:

(h) The total quantity of gas allocated by each Allocation Agent in respect of a trading interval at a non-SAW delivery point to which clause 3.5.3(a) applies must equal the total quantity of gas withdrawn from the transmission system or distribution system during that trading interval at that non-SAW delivery point (as measured and determined in accordance with clause 4.4).

(i) Where a withdrawal allocation statement has been submitted by an Allocation Agent which specifies a Market Participant as having withdrawn a quantity of gas from the transmission system at a non-SAW point on a gas day, that Market Participant may submit to VENCorp, not later than the third day after each gas day or such later time as VENCorp may agree with that Market Participant, a sub-allocation statement specifying:

(1) that such quantity is to be treated as having been withdrawn from the transmission system at that non-SAW point by one or more Market Participants (who may include the Market Participant specified in the withdrawal allocation statement);





(4) the proportion of such quantity which is to be treated as having been withdrawn by each of those Market Participants.




3.5.3(i) to be altered as follows:

(i) Where a withdrawal allocation statement has been submitted by an Allocation Agent which specifies a Market Participant as having withdrawn a quantity of gas from the transmission system at a non-SAW delivery point to which clause 3.5.3(a) applies on a gas day, that Market Participant may submit to VENCorp, not later than 5:00 p.m. on the third calendar day after each gas day or such later time as VENCorp may agree with that Market Participant, a sub-allocation statement specifying:

(1) that such quantity is to be treated as having been withdrawn from the transmission system at that non-SAW delivery point by one or more Market Participants (who may include the Market Participant specified in the withdrawal allocation statement);



(4) the proportion of such quantity which is to be treated as having been withdrawn by each of those Market Participants.

(j) VENCorp is not required to have regard to any sub-allocation statement unless each Market Participant identified in that sub-allocation statement has confirmed in writing to VENCorp that it has appointed the Sub-allocation Agent for the relevant non-SAW point for the purposes of clause 3.5.3(i).




3.5.3(j) to be altered as follows:

(j) VENCorp is not required to have regard to any sub-allocation statement unless each Market Participant identified in that sub-allocation statement has confirmed in writing to VENCorp that it has appointed the Sub-allocation Agent for the relevant non-SAW delivery point for the purposes of clause 3.5.3(i).

(k) VENCorp is entitled to rely on any withdrawal allocation statement or sub-allocation statement which has been submitted by an Allocation Agent or a Sub-allocation Agent for the purposes of determining the quantities of gas treated as withdrawn from the transmission system by all Market Participants who have appointed that Allocation Agent or Sub-allocation Agent.

(l) If:

(1) an Allocation Agent has not been appointed in respect of a non-SAW point; or

(2) VENCorp is notified by a Market Participant that the appointment of an Allocation Agent in respect of a non-SAW point has been terminated by that or any other Market Participant,



VENCorp must determine the quantities of gas which are to be treated as withdrawn by Market Participants at that non-SAW point in accordance with clause 3.5.3(m) and, in the case of paragraph (2) of this clause 3.5.3(l), must disregard any withdrawal allocation statement subsequently given by that Allocation Agent in respect of that non-SAW point.




3.5.3(l) to be altered as follows:

(l) If, in relation to a delivery point to which clause 3.5.3(a) applies:

(1) an Allocation Agent has not been appointed in respect of a non-SAW that delivery point; or

(2) VENCorp is notified by a Market Participant that the appointment of an Allocation Agent in respect of a non-SAW that delivery point has been terminated by that or any other Market Participant,

VENCorp must determine the quantities of gas which are to be treated as withdrawn by Market Participants at that non-SAW delivery point in accordance with clause 3.5.3(m) and, in the case of paragraph (2) of this clause 3.5.3(l), must disregard any withdrawal allocation statement subsequently given by that Allocation Agent in respect of that non-SAW delivery point.

(m) If clauses 3.5.3(f) or (l) apply, VENCorp must determine the quantity of gas which is to be treated as having been withdrawn by each Market Participant at the relevant non-SAW point in accordance with the following formula:

Q = MQ x

Where:

Q is the quantity of gas which is to be treated as having been withdrawn by that Market Participant at that non-SAW point in a trading interval;

MQ is the actual quantity of gas withdrawn from the transmission system at that non-SAW point in that trading interval;

SQi is the quantity of gas scheduled by VENCorp for withdrawal by that Market Participant at that non-SAW point in that trading interval; and

SSQj is the total quantity of gas scheduled by VENCorp for withdrawal by all Market Participants at that non-SAW point in that trading interval,

provided that VENCorp may, with the approval of the Regulator and on prior notice given to any affected Market Participant, vary the above formula, or use a different formula, in any case where it is established that the application of the above formula, in all the circumstances, affords undue preference to that Market Participant and undue prejudice to other Market Participants and in exercising its discretion under this proviso, VENCorp may, with the approval of the Regulator, have regard to title to gas.






3.5.3(m) to be deleted and replaced with the following:

(m) If clauses 3.5.3(f) or (l) apply, then the quantity of gas which is to be treated for settlement purposes as having been withdrawn by each Market Participant at the relevant delivery point shall be that quantity reasonably determined by VENCorp using the information available to it at the time and following consultation with the affected Market Participants.

(ma) Where VENCorp has acted in accordance with clause 3.5.3(m) then VENCorp may recover reasonable costs incurred in applying that clause from those Market Participants to which the application has applied and those Market Participants must pay VENCorp those costs.

(n) An Allocation Agent may be appointed to act in relation to more than one non-SAW point and may also be appointed to act in relation to one or more system injection points.




3.5.3(n) to be deleted and replaced with the following:

(n) An Allocation Agent may be appointed to act in relation to more than one non-SAW delivery point and may also be appointed to act in relation to one or more system injection points.

3.5.4 Withdrawal allocations - SAW pointsMSO Rules Amendments to facilitate Full Retail Contestability:



3.5.4 to be deleted in its entirety without replacement.

(a) VENCorp must establish prior to the commencement date an algorithm for the purpose of allocating the aggregate quantities of gas withdrawn by Market Participants from each SAW point to those Market Participants.

(b) VENCorp may appoint any expert or adviser for the purpose of assisting in the development of the allocation algorithm.

(c) VENCorp must, upon request, give a copy of the allocation algorithm to each Market Participant who, in VENCorp’s reasonable opinion, will or is likely to be affected by the allocation algorithm.

(d) VENCorp must:

(1) at any time VENCorp considers that the allocation algorithm does not effect an allocation in respect of gas withdrawn from the transmission system at each SAW point in a fair and reasonable way; or

(2) if VENCorp proposes to designate a system withdrawal point as a new SAW point; or



(3) upon written request by two or more Participants who, in VENCorp’s reasonable opinion, are affected by the allocation algorithm; and

(4) in any event, at least once each year,

undertake a review of the allocation algorithm and consult with all Market Participants who, in VENCorp’s reasonable opinion, are affected by the allocation algorithm with a view to making any changes to the allocation algorithm which VENCorp considers necessary to effect a fair and reasonable allocation.

3.5.5 ReconciliationMSO Rules Amendments to facilitate Full Retail Contestability:



All 3.5.5 to be deleted in its entirety without replacement.

(a) VENCorp must establish, prior to the commencement date, reconciliation procedures for the purpose of carrying out a reconciliation and adjustment in respect of gas withdrawn from the transmission system at each SAW point, in respect of the differences between:

(1) the quantities determined as withdrawn by a Market Participant by application of the allocation algorithm in accordance with clause 3.5.4; and

(2) the quantities subsequently determined to have been withdrawn by that Market Participant upon the obtaining of NDM meter readings.

(b) The reconciliation procedures will be used to determine reconciliation amounts for each billing period.

(c) VENCorp must consult with all Market Participants who, in VENCorp’s reasonable opinion, will or are likely to be affected by the reconciliation procedures with the intent of facilitating the agreement of all such Market Participants to the terms of the reconciliation procedures.

(d) VENCorp may appoint any expert or adviser for the purpose of assisting in the development of the reconciliation procedures.

(e) VENCorp must, upon request, give a copy of the reconciliation procedures to each Market Participant who, in VENCorp’s reasonable opinion, will or is likely to be affected by the reconciliation procedures.

(f) VENCorp must:

(1) at any time VENCorp considers that the reconciliation procedures do not effect a reconciliation and adjustment in respect of gas withdrawn from the transmission system at each SAW point in a fair way; or

(2) if VENCorp proposes to designate a system withdrawal point as a new SAW point; or

(3) upon written request by two or more Participants who, in VENCorp’s reasonable opinion, are affected by the reconciliation procedures; and



(4) in any event, at least once each calendar year,

undertake a review of the reconciliation procedures and consult with all Market Participants who, in VENCorp’s reasonable opinion, are affected by the reconciliation procedures with a view to:

(5) making any changes to the reconciliation procedures which VENCorp considers necessary to effect a fair reconciliation and adjustment; and

(6) facilitating the agreement of all such Market Participants to the changes to the reconciliation procedures.

(g) Market Participants must comply with the reconciliation procedures.



3.6 SETTLEMENTS

3.6.1 Settlements management by VENCorp(a) VENCorp must determine market fees payable by Market Participants and facilitate the

billing and settlement of transactions between Market Participants under these Rules in accordance with this clause 3.6.

(b) Market Participants must pay market fees to VENCorp in accordance with clause 2.6.

3.6.2 Electronic funds transfer(a) VENCorp must ensure that an EFT facility is provided and made available for all Market

Participants for the purposes of facilitating settlements and the collection and payment of all market fees.

(b) Unless otherwise authorised by VENCorp, all Market Participants must use the EFT facility provided by VENCorp under clause 3.6.2(a) for the settlement of transactions and the payment of market fees.

3.6.3 Trading amounts for trading intervals(a) VENCorp must determine for each trading interval:

(1) each Market Participant’s trading imbalance for that trading interval in accordance with clause 3.6.4;

(2) each Market Participant’s daily EoD linepack credit or daily EoD linepack debit for that trading interval in accordance with clause 3.6.9;

(3) the ancillary payment (if any) payable to each Market Participant in respect of that trading interval in accordance with clause 3.6.7;

(4) the uplift payment (if any) payable by each Market Participant in respect of that trading interval in accordance with clause 3.6.8;

(5) the market price for that trading interval in accordance with clause 3.2; and

(6) the trading amount for each Market Participant for that trading interval, as determined in accordance with clause 3.6.3(b).

(b) The trading amount for a Market Participant for a trading interval equals the sum of:

(1) that Market Participant’s trading imbalance for that trading interval (determined in accordance with clause 3.6.4) multiplied by the market price for that trading interval; plus

(2) that Market Participant’s daily EoD linepack credit (if any) for that trading interval determined in accordance with clause 3.6.9; minus

(3) that Market Participant’s daily EoD linepack debit (if any) for that trading interval determined in accordance with clause 3.6.9.

3.6.4 Trading imbalances(a) The trading imbalance of a Market Participant in a trading interval shall be determined, in

GJ, as the difference between its aggregate injections of gas at all system injection points in that trading interval and its aggregate adjusted withdrawals of gas, as determined in accordance with clauses 3.6.4(b), (c) and (d) in that trading interval.


The following changes/additions to the MSO Rules have been approved by the VENCorp Board of Directors and have



received authorisation under the Trade Practices Act by the ACCC.



(a) The trading imbalance of a Market Participant in a trading interval shall be determined, in GJ, as the difference between its aggregate injections of gas at all system injection points in that trading interval and its aggregate adjusted withdrawals of gas, as determined in accordance with clauses 3.6.4(b), (c), and (d) and (da) in that trading interval.

(b) For the purpose of determining each Market Participant’s trading imbalance in a trading interval, VENCorp must make an adjustment to the total quantity of gas (if any) withdrawn by that Market Participant from the transmission system in that trading interval to account for unaccounted for gas in accordance with the following formula:

AW = MW / (1 - UAFGT)

Where:

AW is the adjusted quantity of gas which is to be treated as having been withdrawn by that Market Participant from the transmission system in that trading interval;

MW is the quantity of gas withdrawn by that Market Participant from the transmission system in that trading interval; and

UAFGT is 0.0.

(c) For the purpose of determining each Market Participant’s trading imbalance in a trading interval, VENCorp must make an adjustment to the total quantity of gas (if any) withdrawn by that Market Participant from a distribution delivery point in that trading interval to account for unaccounted for gas in accordance with the following formula:

AW = MW / {(1 - UAFGD) x (1-UAFGT)}

Where:

AW is the adjusted quantity of gas which is to be treated as having been withdrawn by that Market Participant from that distribution delivery point in that trading interval;

MW is the quantity of gas withdrawn by that Market Participant from that distribution delivery point in that trading interval;

UAFGD is the relevant value assigned to:

(1) the Distributor on whose distribution pipeline the distribution delivery point is located; and

(2) the quantity of gas withdrawn by that Market Participant at that distribution delivery point,

in accordance with Part C of Schedule 1 of the Distribution System Code; and

UAFGT is 0.0.

(d) A Market Participant’s adjusted withdrawals at a system withdrawal point or a distribution delivery point are to be determined:



(1) at a SAW point, or a non-SAW point at which an Allocation Agent has been appointed in accordance with clause 3.5.3(a), as the quantity of gas allocated to that Market Participant at that system withdrawal point in accordance with clause 3.5.3 or 3.5.4, as appropriate, adjusted in accordance with clause 3.6.4(b);

(2) at a non-SAW point at which an Allocation Agent has not been appointed under clause 3.5.3(a), as the metered quantity of gas withdrawn at that system withdrawal point, adjusted in accordance with clause 3.6.4(b), minus the sum of any metered quantities withdrawn at distribution delivery points supplied from that system withdrawal point, adjusted in accordance with clause 3.6.4(c), where gas is withdrawn by Customers other than that Market Participant or that Market Participant’s Customers; and

(3) at a distribution delivery point, as the metered quantity of gas withdrawn at that distribution delivery point, adjusted in accordance with clause 3.6.4(c).





(d) A Market Participant’s adjusted withdrawals at a system withdrawal point or a distribution delivery point are to be determined:

(1a) subject to clauses 3.6.4(d)(1) and 3.6.4(d)(2), at that system withdrawal point as the metered quantity of gas withdrawn, adjusted in accordance with clause 3.6.4(b);

(1) at a SAW point, or a non-SAW point system withdrawal point at which an Allocation Agent has been appointed in accordance with clause 3.5.3(a), as the quantity of gas allocated to that Market Participant at that system withdrawal point in accordance with clause 3.5.3 or 3.5.4, as appropriate, adjusted in accordance with clause 3.6.4(b);

(2) at a non-SAW system withdrawal point at which an Allocation Agent has not should have been appointed under clause 3.5.3(a) but has not been appointed, as the metered quantity of gas determined in accordance with clause 3.5.3(m), withdrawn at that system withdrawal point, adjusted in accordance with clause 3.6.4(b)., minus the sum of any metered quantities withdrawn at distribution delivery points supplied at that system withdrawal point, adjusted in accordance with clause 3.6.4(c), where gas is withdrawn by Customers other than that Market Participant or that Market Participant’s Customers; and

(3) at a distribution delivery point, as the metered quantity of gas withdrawn at that distribution delivery point, adjusted in accordance with clause 3.6.4(c).






3.6.4(da) to be inserted following 3.6.4(d):

(da) A Market Participant’s adjusted withdrawals at a distribution delivery point are:

(1) at that distribution delivery point, subject to clauses 3.6.4(da)(2) and 3.6.4(da)(3), determined as:

(A) the metered quantity of gas withdrawn at that point; or

(B) the data provided to VENCorp for settlement purposes in accordance with the Retail Gas Market Rules for that point,

adjusted in accordance with clause 3.6.4(c);

(2) at a distribution delivery point at which an Allocation Agent has been appointed in accordance with clause 3.5.3(a), determined as the quantity of gas allocated to that Market Participant at that distribution delivery point in accordance with clause 3.5.3, adjusted in accordance with clause 3.6.4(c); and

(3) at a distribution delivery point at which an Allocation Agent should have been appointed under clause 3.5.3(a) but has not been appointed, determined as the quantity of gas determined in accordance with clause 3.5.3(m), adjusted in accordance with clause 3.6.4(c).

(e) A Market Participant’s aggregate adjusted withdrawals in a trading interval are determined as:

SAW = SAWT + SAWD

Where:

SAW is the aggregate of all that Market Participant’s adjusted withdrawals in that trading interval;

SAWT is the sum of all that Market Participants’ adjusted withdrawals at system withdrawal points in that trading interval; and

SAWD is the sum of all that Market Participant’s adjusted withdrawals in that trading interval at distribution delivery points supplied from system withdrawal points other than those for which quantities have been included in SAWT.

3.6.5 Settlement amounts for billing periods(a) VENCorp must determine the settlement amount for each Market Participant for each

billing period in accordance with clause 3.6.5(b).(b) The settlement amount for a Market Participant for a billing period equals the sum of:

(1) the sum of that Market Participant’s trading amounts for each trading interval in that billing period; plus

(2) that Market Participant’s positive reconciliation amount (if any) in respect of any prior billing period determined in accordance with clause 3.5; less

(3) that Market Participant’s negative reconciliation amount (if any) in respect of any prior billing period determined in accordance with clause 3.5; less



(4) the aggregate of:

(A) any market fees which that Market Participant is required to pay in respect of that billing period calculated in accordance with clause 2.6; and

(B) any participant compensation fund contribution which that Market Participant is required to make in accordance with clause 3.3; and

(C) any amount which that Market Participant is required to pay to VENCorp in respect of compensation payments in accordance with clause 3.6.6; plus

(5) if VENCorp has completed its determination of ancillary payments and consequential associated uplift payments arising from a trading interval:(A) the amount of any ancillary payments determined to be payable to that

Market Participant in accordance with clause 3.6.7 in respect of that trading interval and not previously taken into account in determining the settlement amount for a billing period in respect of that Market Participant, minus

(B) the amount of any uplift payments determined to be payable by that Market Participant in accordance with clause 3.6.8 in respect of that trading interval and not previously taken into account in determining the settlement amount for a billing period in respect of that Market Participant; minus

(6) any other amounts payable by that Market Participant to VENCorp in respect of that billing period; plus

(7) any amount payable by VENCorp to that Market Participant in respect of any linepack account surplus in accordance with clause 3.6.12(c); minus

(8) any amount payable by that Market Participant to VENCorp in respect of any linepack account deficit in accordance with clause 3.6.12(b); plus

(9) any other amount payable by VENCorp to that Market Participant in respect of that billing period.





(b) The settlement amount for a Market Participant for a billing period equals the sum of:

(1) ........ remains unchanged

(2) that Market Participant’s positive reconciliation amount (if any) in respect of any prior billing period determined in accordance with clause 3.5; less

(3) that Market Participant’s negative reconciliation amount (if any) in respect of any prior billing period determined in accordance with clause 3.5; less

(4) to (9) ....... remain unchanged

(c) The settlement amount determined by VENCorp pursuant to clause 3.6.5(b) for each Market Participant will be a positive or negative dollar amount.



(d) Each component of the settlement amount determined by VENCorp pursuant to clause 3.6.5(b) for each Market Participant is subject to the application of GST, where applicable, under clause 3.8.

3.6.6 Funding compensation payments and payments for gas supplied to VENCorp under contract(a) If compensation is to be paid to a Market Participant in accordance with clause 6.6.5 or

6.7.6, or amounts are payable to VENCorp in accordance with clause 6.5.2(e) or 6.5.3(e), then VENCorp is entitled to recover those payments from Participants in accordance with this clause 3.6.6 and each Market Participant and Transmission Pipeline Owner must pay to VENCorp an amount determined in accordance with this clause 3.6.6.

(b) If:

(1) VENCorp has instructed a Market Participant to inject gas in accordance with clause 6.6.4, or

(2) VENCorp has entered into a contract with a person and instructed that person to inject gas in an emergency in accordance with clause 6.5.2(c)

and

(3) that Market Participant or person is entitled to be paid compensation in accordance with clause 6.6.5 or 6.7.6, or amounts are payable to VENCorp in accordance with clause 6.5.2(e), and

(4) as a result of that injection or withdrawal, as the case may be, there is a net increase in the quantity of system linepack over a trading interval greater than that scheduled by VENCorp for that trading interval

then VENCorp shall be entitled to be paid from the linepack account an amount calculated as:

if QLA – QLS > 0 and QLA – QLS £ QAG

then RLA = CPT x [QLA – QLS]; or QAG

if QLA – QLS > 0 and QLA – QLS > QAG

then RLA = CPT; or

if QLA – QLS £ 0

then RLA = 0

Where:

RLA is the amount in $ of the payment to be paid to VENCorp from the linepack account;

CPT is the sum of the amounts in $ of compensation payable by VENCorp to all Market Participants for that trading interval determined in accordance with clauses 6.6.5 or 6.7.6, or amounts payable to VENCorp in accordance with clause 6.5.2(e);

QLA is the actual total amount in GJ of system linepack increase for that trading interval;

QLS is the total amount in GJ of system linepack increase last scheduled by VENCorp for that trading interval; and



QAG is the sum of the amounts in GJ of actual additional gas injected by all Market Participants during that trading interval as a consequence of VENCorp’s instructions made in accordance with clauses 6.5.2 or 6.6.4.

(ba) If the amount calculated in accordance with clause 3.6.6(b) is insufficient to satisfy the total amount:

(1) of compensation payable by VENCorp to a Market Participant entitled to be paid under clause 6.6.5, or

(2) payable to VENCorp as a result of a contract entered into by VENCorp in accordance with clauses 6.5.2 or 6.5.3,

then VENCorp shall be entitled to recover the outstanding balance of that payment from Participants in accordance with clauses 3.6.6(bb) and 3.6.6(bc).

(bb) Where a Participant must pay to VENCorp an uplift payment amount determined under clause 3.6.8 for the trading interval for which there is a payment amount recoverable by VENCorp under 3.6.6(ba) then that Participant must pay an amount to VENCorp calculated as:

RCP = RUL x U SU

Where

RCP is the amount payable in $ by a Market Participant to VENCorp in respect of that trading interval;

RUL is the total amount in $ to be recovered by VENCorp under clause 3.6.6(ba) for that trading interval;

U is the total amount in $ of uplift payment to be paid to VENCorp by that Participant for that trading interval;

SU is the aggregate amount of uplift payment in $ to be paid to VENCorp by all Participants for that trading interval.

(bc) If compensation payments are to be paid by VENCorp under clause 6.7.6 or if there is a payment amount outstanding after the application of clause 3.6.6(bb) then each Market Participant who purchased gas from the market in the trading interval in respect of which compensation is to be paid must pay an amount to VENCorp calculated as:

RAP = CPA x N SN

where

RAP is the amount payable in $ by a Market Participant to VENCorp in respect of that trading interval;

CPA is the total amount in $ to be recovered by VENCorp from all Market Participants under clause 6.7.6 or after the application of 3.6.6(bb), as the case may be, in that trading interval;

N is the negative trading imbalance in GJ of that Market Participant in that trading interval; and

SN is the sum of negative trading imbalances in GJ of all Market Participants in that trading interval.

(c) If VENCorp determines that an amount is payable by the Market Participant under this clause 3.6.6 then VENCorp must seek the direction the Board of Directors of VENCorp as



to the manner by which that amount is to be paid to VENCorp by that Market Participant. VENCorp must seek that direction at the next meeting of the Board for which submissions are still being received. The Board may determine that the payment be paid in instalments or deferred for a specified period of time.

(ca) If the Board of Directors of VENCorp under clause 3.6.6(c):

(1) (A) fails to make a determination at the Board meeting to which VENCorp has made a submission, or

(B) determines not to defer the amount payable, and

(C) determines not to allow the payment of the amount payable by instalment,

then VENCorp must include the whole of the amount payable in the next preliminary statement issued to that Market Participant in accordance with clause 3.6.14 following the Board of Directors meeting.

(2) determines that:

(A) the amount payable shall be paid in instalments, or

(B) the payment of the amount payable shall be deferred for a specified period of time

then VENCorp must include in the next preliminary statement to a Market Participant issued in accordance with clause 3.6.14 following the Board of Directors determination, the details of the total amount to be paid by that Market Participant, the instalment amounts to be paid and the dates by which each instalment is to be paid or the deferred date by which the whole amount is to be paid, as the case may be.

(d) Market Participants must pay interest on amounts determined in accordance with this clause 3.6.6 at the interest rate from the day following the date of the next payment of settlement amounts following the determination of the compensation panel to the date when the Market Participant actually pays the amount to VENCorp. Interest is to be calculated on a daily basis and aggregated for the period.

3.6.7 Ancillary payments(a) (1) Subject to clauses 3.6.7(a)(2), (3) and (4), any Market Participant who, as a result

of responding in whole or in part to a scheduling instruction, injects or withdraws more gas than the quantity of gas that that Market Participant was scheduled to inject or withdraw under the pricing schedule, is entitled to receive an ancillary payment in accordance with this clause 3.6.7.

(2) A Market Participant who submits any withdrawal inc/dec offer that is not accredited by VENCorp under clause 3.1.6 is not entitled to be paid ancillary payments in respect of that withdrawal inc/dec offer.

(3) If the administered price cap applies during a trading interval, then for the purposes of determining ancillary payments payable by a Market Participant under this clause 3.6.7 any injection or withdrawal of gas by that Market Participant is deemed to be made in accordance with an inc/dec offer for which the price steps are deemed to be no greater than the administered price cap.

(4) For the avoidance of doubt, if a Market Participant is instructed by VENCorp to inject or withdraw a quantity of gas which is less than the amount of gas specified for injection or withdrawal (as the case may be) by that Market Participant in the pricing schedule, that Market Participant is not entitled to be paid ancillary payments for that amount.



(b) If in any trading interval a Market Participant’s actual deviation and scheduled deviation are both positive and the actual deviation is less than or equals the scheduled deviation, the ancillary payments payable to that Market Participant will, subject to clause 3.6.7(a) and where the ancillary payment is more than zero, be:

(1) in the case of an injection inc/dec offer:(A) where UH is more than the quantity of gas to be injected by that Market

Participant in that trading interval under the relevant pricing schedule applicable to that trading interval:

ISUH - ISA

where

ISUH means, in respect of a Market Participant who injects gas, the product of the market price for that trading interval and UH, less the deemed cost of those injections of gas as implied by the price steps specified in the Market Participant’s inc/dec offer;

ISA means, in respect of a Market Participant who injects gas, the product of the market price for that trading interval and the quantity of that Market Participant’s actual injections of gas in that trading interval, less the deemed cost of those actual injections as implied by the price steps specified in the Market Participant’s inc/dec offer;

UH for a Market Participant at a system injection point means:

(i) that part of the quantity TUH, where TUH is determined in accordance with the procedures published by VENCorp under clauses 3.6.8(a) and 3.6.8(aa), applicable at the relevant system injection point for that Market Participant and determined in accordance with 3.6.7(b)(1)(A)(ii); and

(ii) that part of the quantity TUH applicable at each relevant system injection point as determined by assigning the quantity of TUH to these system injection points in ascending price order of the price steps for injection inc/dec offers which are applicable at these system injection points for the relevant trading period.

(B) where UH is less than or equal to the quantity of gas to be injected by that Market Participant in that trading interval under the relevant pricing schedule applicable to that trading interval:

ISP - ISA

where

ISP means, in respect of a Market Participant who injects gas, the product of the market price for that trading interval and the quantity of gas to be injected by that Market Participant in that trading interval under the relevant pricing schedule applicable to that trading interval, less the deemed cost of those injections of gas as implied by the price steps specified in the Market Participant’s inc/dec offer;

ISA has the meaning given in clause 3.6.7(b)(1)(A);

UH has the meaning given in clause 3.6.7(b)(1)(A);

(2) in the case of a withdrawal inc/dec offer:

WSP - WSA



where

WSP means, in respect of a Market Participant who withdraws gas, the deemed cost of the quantity of gas scheduled in the relevant pricing schedule to be withdrawn by that Market Participant in that trading interval as implied by the price steps specified in the Market Participant’s inc/dec offer, less the product of the market price for that trading interval and the quantity of gas scheduled in the relevant pricing schedule to be withdrawn by that Market Participant in that trading interval; and

WSA means, in respect of a Market Participant who withdraws gas, the deemed cost of the Market Participant’s actual withdrawals of gas as implied by the price steps specified in that Market Participant’s inc/dec offer, less the product of the market price for that trading interval and the quantity of gas actually withdrawn by that Market Participant in that trading interval.

(c) If in any trading interval a Market Participant’s actual deviation and scheduled deviation are both positive and the actual deviation exceeds the scheduled deviation, the ancillary payment payable to that Market Participant will, subject to 3.6.7(a) and where the ancillary payment is more than zero, be:

(1) in the case of an injection inc/dec offer:(A) where UH is more than the quantity of gas to be injected by that Market

Participant in that trading interval under the relevant pricing schedule applicable to that trading interval:

ISUH - ISS

where

ISUH has the meaning given in clause 3.6.7(b)(1)(A);

ISS means, in respect of a Market Participant who injects gas, the product of the market price for that trading interval and the quantity of gas scheduled to be injected by that Market Participant in that trading interval in accordance with the relevant scheduling instruction applicable to that trading interval, less the deemed cost of those injections as implied by the price steps specified in the Market Participant’s inc/dec offer;


(B) where UH is less than or equal to the quantity of gas to be injected by that Market Participant in that trading interval under the relevant pricing schedule applicable to that trading interval:

ISP - ISS

where

ISP has the meaning given in clause 3.6.7(b)(1)(A); and

ISS has the meaning given in clause 3.6.7(c)(1)(A);


(2) in the case of a withdrawal inc/dec offer:

WSP - WSS

where



WSP has the meaning given in clause 3.6.7(b)(2); and

WSS means, in respect of a Market Participant who withdraws gas, the deemed cost of withdrawals of gas by that Market Participant in that trading interval in accordance with the scheduling instructions for that trading interval as implied by the prices of the Market Participant’s inc/dec offers, less the product of the market price for that trading interval and the quantity of gas scheduled to be withdrawn by that Market Participant in that trading interval in accordance with the relevant scheduling instruction applicable in that trading interval.

(d) If a Market Participant’s scheduled deviation is negative or a Market Participant’s actual deviation is negative then the ancillary payment for that Market Participant in respect of the deviation will be zero.

[Clauses 3.6.7(e), (f) and (g): Order in Council, 11 March 1999]

3.6.8 Uplift Payments(a) Subject to clause 3.6.8(b), VENCorp must consult with Market Participants and

Transmission Pipeline Owners and establish and publish procedures pursuant to which VENCorp can determine:

(1) an estimate of the portion (if any) of any ancillary payments payable in respect of a trading interval in accordance with clause 3.6.7 which are attributable to daily and within day transmission constraints; and

(2) an estimate of the total size in GJ of the daily and within day transmission constraint (if any) giving rise to the portion of ancillary payments estimated in accordance with clause 3.6.8(a)(1).

(3) in respect to any ancillary payments payable in a trading interval the uplift payments to be made by each Transmission Pipeline Owner and Market Participant.

(aa) Subject to clause 3.6.8(b), VENCorp may, in consultation with Market Participants and Transmission Pipeline Owners, modify the procedures established in accordance with clause 3.6.8(a) and if VENCorp does so it must publish those modified procedures.

(b) In developing the procedures for determining uplift payments under clauses 3.6.8(a) and 3.6.8(aa), VENCorp must use its reasonable endeavours to ensure that the procedures apply the following principles:

(1) the principles and procedures should not be unreasonably complex; and

(2) any increase in VENCorp’s systems and/or operational costs arising from application of the principles and procedures should not be disproportionate to the aggregate amounts of ancillary payments likely to be made:

(3) so far as practicable and subject to other parts of this clause 3.6.8(b), uplift payments are to be allocated to the cause;

(4) so far as practicable and subject to other parts of this clause 3.6.8(b), the allocation of uplift payments must consider the impact on relevant investment signals; and

(5) the allocation of uplift payments arising from events which give rise to daily transmission constraints must consider exceedance of authorised MDQ and AMDQ credits in the methodology.



(c) A Market Participant must pay uplift payments in respect of withdrawals of gas by that Market Participant or by Customers who purchase gas from that Market Participant Participant in accordance with the principles of clause 3.6.8(b) and the procedures published by VENCorp under clauses 3.6.8(a) and 3.6.8(aa).

(d) For the avoidance of doubt, nothing in clause 3.6.8(c) precludes a Retailer from recovering from its Customers the amount of any liability to pay uplift payments in respect of withdrawals of gas by those Customers.

(da) Subject to clause 3.6.8(db) a Transmission Pipeline Owner must pay uplift payments calculated in accordance with the principles of clause 3.6.8(b), the quantity determined under clause 3.6.8(f)(1), and the procedures published by VENCorp under clauses 3.6.8(a) and 3.6.8(aa).

(db) Where the amount of uplift payment attributable to the failure of the relevant Transmission Pipeline Owner to fulfil its obligations under its service envelope agreement in any trading interval exceeds any applicable limit on the Transmission Pipeline Owner’s liability for uplift payments under its service envelope agreement (if any and if applicable), then Market Participants must pay the uplift payment amount in excess of the applicable limit and in accordance with the procedures published by VENCorp under clauses 3.6.8(a) and 3.6.8(aa).

(e) As soon as reasonably practicable, VENCorp must publish details of total amounts of ancillary payments to be made in respect of each trading interval and the portions of those ancillary payments which are due to transmission constraints, if any.

(f) If, in accordance with the principles and procedures published by VENCorp under clause 3.6.8(a) and 3.6.8(aa), VENCorp determines that any part of any ancillary payments which are payable in respect of a trading interval is attributable to a transmission constraint, then VENCorp must also determine and publish:

(1) after following any procedures for doing so and taking into consideration any other relevant matter set out in the relevant service envelope agreement, the extent (measured in GJ) to which that transmission constraint was caused by the failure of the relevant Transmission Pipeline Owner to fulfil its obligations under its service envelope agreement in that trading interval;

(2) the aggregate of any quantities of gas withdrawn at tariff D withdrawal points in that trading interval in excess of the authorised MDQ applicable to those tariff D withdrawal points;

(3) the aggregate quantity of gas, if any, withdrawn at all tariff V withdrawal points in that trading interval in excess of the aggregate authorised MDQ applicable to those tariff V withdrawal points; and

(4) the aggregate quantity of gas withdrawn at all tariff D withdrawal points in that trading interval.

Clauses (g), (ga) and (gb) deleted by notice in the Governamant Gazette dated 28 February 2002.

(gc) The AMDQ credits at a system injection point for which a Market Participant is the registered holder of AMDQ credits certificates, is the lesser of:

(1) the amount in GJ certificated by AMDQ credits certificates registered to that Market Participant at that system injection point;



(2) the amount in GJ of the AMDQ credit nomination by the Market Participant who is the registered holder of the relevant AMDQ credits certificates at that system injection point;

(3) the amount in GJ scheduled by VENCorp to be injected at that system injection point; and

(4) the actual quantity of gas injected at that system injection point in response to a scheduling instruction for that trading interval.

Clauses (gd), (h), (i), (j), (k) and (l) deleted by notice in the Government Gazette dated 28 February 2002.

Section 3.6.9 deleted by notice in the Government Gazette dated 28 February 2002.

3.6.10 Linepack account(a) VENCorp must maintain a linepack account for the purpose of recording the linepack credit

or linepack debit which is required to be made in respect of each gas day (as determined in accordance with clause 3.6.10(c)).

(b) VENCorp must record in the linepack account all linepack credits and linepack debits.

(c) VENCorp must determine the amount of any linepack credit or linepack debit which it is required to record in the linepack account in respect of each gas day in accordance with the following formula:

Q = (I-W - EDL) x PM

Where:

Q is the amount of the linepack debit (where Q is a positive amount) or the amount of the linepack credit (where Q is a negative amount) in respect of that gas day;

I is the total quantity of gas injected into the transmission system during that gas day;

W is the total quantity of gas withdrawn from the transmission system during that gas day;


MSO Rules Amendments to facilitate site AMDQ credits:


Implementation of these amendments to the MSO Rules will take place on a date yet to be advised.

3.6.8(gc) is to be deleted

(gc) The AMDQ credits at a system injection point for which a Market Participant is the registered holder of AMDQ credits certificates, is the lesser of:

(1) the amount in GJ certificated by AMDQ credits certificates registered to that Market Participant at that system injection point;

(2) the amount in GJ of the AMDQ credit nomination by the Market Participant who is the registered holder of the relevant AMDQ credits certificates at that system injection point;

(3) the amount in GJ scheduled by VENCorp to be injected at that system injection point; and

(4) the actual quantity of gas injected at that system injection point in response to a scheduling instruction for that trading interval.


EDL is the aggregate quantity of EoD linepack purchased by Market Participants in respect of that gas day in accordance with clause 3.4.2; and

PM is the market price for that gas day.

(d) The linepack account must record both quantities, expressed in joules, and monetary values.

Clauses 3.6.8(g) to 3.6.8(k) inclusive deleted by notice in the Government Gazette dated 28 February 2002.


3.6.11 Review of linepack accountVENCorp must establish, document and make available to Market Participants procedures for the regular review by the VENCorp Board of the linepack account and the basis upon which linepack transactions are to be funded.

3.6.12 Linepack payments(a) VENCorp must clear the balance on the linepack account each month by charging or

making payments to Market Participants in accordance with this clause 3.6.12.

(b) If the sum of daily linepack debits for the relevant month plus the sum of payments made to VENCorp in accordance with clause 3.6.6(b) for the relevant month less the absolute sum of daily linepack credits for the relevant month (as determined under clause 3.6.10(c)) is a positive amount, each Market Participant who withdrew gas from the transmission system in that month must pay VENCorp an amount calculated as follows:

PM = DB x QWi SQWi

Where:

PM is the amount which the Market Participant must pay;

DB is the sum of daily linepack debits for the relevant month plus the sum of payments made to VENCorp in accordance with clause 3.6.6(b) for the relevant month less the absolute sum of daily linepack credits for the relevant month (as determined under clause 3.6.10(c));

QWi is the quantity of gas withdrawn from the transmission system by that Market Participant in that month; and

SQWi is the total quantity of gas withdrawn from the transmission system by all Market Participants in that month.

(c) If the sum of daily linepack debits for the relevant month plus the sum of payments made to VENCorp in accordance with clause 3.6.6(b) for the relevant month less the absolute sum of daily linepack credits for the relevant month (as determined under clause 3.6.10(c)) is a negative amount, VENCorp must pay each Market Participant who withdrew gas from the transmission system in that month an amount calculated as follows:

PV = CB x QWi SQWi

Where:

PV is the amount which VENCorp is required to pay to the Market Participant;



CB is the sum of daily linepack debits for the relevant month plus the sum of payments made to VENCorp in accordance with clause 3.6.6(b) for the relevant month less the absolute sum of daily linepack credits for the relevant month (as determined under clause 3.6.10(c));

QWi is as defined in clause 3.6.12(b); and

SQWi is as defined in clause 3.6.12(b).

(d) Any amount which a Market Participant or VENCorp must pay pursuant to this clause 3.6.12 must be included by VENCorp in the Market Participant’s settlement statement for the relevant month.

3.6.13 Payment of settlement amount(a) Where the settlement amount for a Market Participant is a negative amount, the Market

Participant must pay that amount to VENCorp in accordance with clause 3.6.16.

(b) Where the settlement amount for a Market Participant is a positive amount, VENCorp must pay that amount to the Market Participant in accordance with clause 3.6.17.

3.6.14 Preliminary statements(a) Within 7 business days after the end of each billing period, VENCorp must give each

Market Participant a preliminary statement which sets out the market transactions of that Market Participant in that billing period and the settlement amount payable by or to that Market Participant.

(b) The statements issued under this clause 3.6.14 must include supporting data for all amounts payable which must be sufficient to enable each Market Participant to audit the calculation of the amount payable by or to that Market Participant.

(c) If the Market Participant reasonably believes there to be an error or discrepancy in the preliminary statement given to the Market Participant by VENCorp under clause 3.6.14(a), the Market Participant must notify VENCorp as soon as practicable of that error or discrepancy and VENCorp must review the preliminary statement.

(d) If VENCorp considers that a preliminary statement contains an error or discrepancy after reviewing the preliminary statement under clause 3.6.14(c), VENCorp must notify all Market Participants whose final statements will be affected by the error or discrepancy within 7 days of the date on which the error or discrepancy first came to the attention of VENCorp and VENCorp must ensure that the error or discrepancy is corrected in the relevant final statements.

3.6.15 Final statements(a) No later than eighteen business days after the end of each billing period, VENCorp must

give to each Market Participant a final statement stating the amounts payable by the Participant to VENCorp or payable by VENCorp to the Market Participant (subject to clause 3.6.22) in respect of the relevant billing period.

(b) The statements issued under this clause 3.6.15 must include supporting data for all amounts payable which must be sufficient to enable each Market Participant to audit the calculation of the amount payable by or to that Market Participant.



3.6.16 Payment by Market Participants(a) No later than 2.00pm on the twentieth business day after the end of a billing period or

2.00pm on the second business day after receiving a final statement under clause 3.6.15, whichever is the later, each Market Participant must pay to VENCorp in cleared funds the settlement amount stated to be payable to VENCorp by that Market Participant in that Market Participant’s final statement, whether or not the Market Participant disputes, or continues to dispute, the amount payable.

(b) Payments made in accordance with clause 3.6.16(a) must be made using bank clearing house arrangements determined by VENCorp in consultation with affected Participants and published by VENCorp.

3.6.17 Payment to Market Participants(a) By no later than 4.00pm on the day on which VENCorp is to be paid under clause 3.6.16,

VENCorp must pay to each Market Participant in cleared funds the settlement amount stated to be payable to that Market Participant in that Market Participant’s final statement.

(b) Payments made in accordance with clause 3.6.17(a) must be made using bank clearing house arrangements determined by VENCorp in consultation with affected Participants and published by VENCorp.

3.6.18 Disputes(a) If a dispute arises between a Market Participant and VENCorp concerning either:

(1) the settlement amount stated in a preliminary statement provided under clause 3.6.14 to be payable by or to it; or

(2) the supporting data,

they must each use reasonable endeavours to resolve the dispute within fifteen business days after the end of the relevant billing period.

(b) Disputes in respect of final statements or the supporting data provided with them in accordance with clause 3.6.15 must be raised within twelve months of the relevant billing period.

(c) Disputes raised under this clause 3.6.18 must be resolved by agreement or pursuant to the dispute resolution procedures set out in clause 7.2.

3.6.19 Settlement revisions (a) If an amount in a final statement issued under clause 3.6.15:

(1) has been the subject of a dispute and the dispute has been resolved in any way which causes the amount payable to differ from the amount payable as set out in the final statement; or

(2) has been identified as being in error in accordance with clause 3.6.19(b) and the correct amount has been determined by VENCorp;

VENCorp must issue to each Market Participant affected by the resolution of the dispute or the correction of the error a revised statement for the relevant billing period setting out:

(3) the amount payable by the Market Participant to VENCorp or the amount payable by VENCorp to the Market Participant (subject to clause 3.6.22); and

(4) the adjustment to the final statement as agreed or determined plus interest calculated on a daily basis at the interest rate for the period from the payment date applicable to the final statement to which the adjustment relates to the payment date applicable to the revised statement issued under this clause 3.6.19(a).







(a) If an amount in a final statement issued under clause 3.6.15:

(1) has been the subject of a dispute and the dispute has been resolved in any way which causes the amount payable to differ from the amount payable as set out in the final statement; or

(2) has been identified as being in error in accordance with clause 3.6.19(b) and the correct amount has been determined by VENCorp;

VENCorp must issue to each Market Participant affected by the resolution of the dispute or the correction of the error a revised statement in accordance with clause 3.6.19(d).for the relevant billing period setting out:



(b) If VENCorp becomes aware of an error in an amount stated in a final statement issued under clause 3.6.15 and in VENCorp’s reasonable opinion a Participant would be materially affected if a revision to the final statement was not made to correct the error, then VENCorp must issue revised statements for the relevant billing period in accordance with clause 3.6.19(a).





(b) If VENCorp becomes aware of an error in an amount stated in a final statement issued under clause 3.6.15 and in VENCorp’s reasonable opinion a Participant would be materially affected if a revision to the final statement was not made to correct the error, then VENCorp must issue revised statements for the relevant billing period in accordance with clause 3.6.19(a) 3.6.19(d).

New 3.6.19(c) and 3.6.19(d) to be inserted after 3.6.19(b) as follows:

(c) VENCorp must revise each final statement issued in accordance with clause 3.6.15 using, for the purpose of that revision, the most recent information available to VENCorp on the 118th business day after the relevant billing period, and VENCorp must issue a revised statement for the relevant billing period in accordance with clause 3.6.19(d).

(d) VENCorp must issue to each Market Participant affected by a revision a revised statement for the relevant billing period within 5 business days of a revision made in accordance with this clause 3.6.19 setting out:





3.6.20 Payment of adjustments(a) VENCorp must specify the time and date on which a payment of an adjustment under a

revised statement issued under clause 3.6.19 is due, which date must be not less than ten business days and not more than fifteen business days after the issue of that revised statement.

(b) By no later than the time and date specified by VENCorp pursuant to clause 3.6.20(a), each Market Participant must pay to VENCorp in cleared funds the net amount stated to be payable by that Market Participant in the revised statement issued to it under clause 3.6.19.

(c) Subject to clause 3.6.22, on the day on which VENCorp is to be paid under clause 3.6.20(b), VENCorp must pay to each Market Participant in cleared funds the net amount stated to be payable to that Market Participant in the revised statement issued to it under clause 3.6.19.




3.6.20 to be altered as follows:

(a) VENCorp must specify the time and date on which a payment of an adjustment under a revised statement issued under clause 3.6.19 is due, which date must be not less than ten business days and not more that fifteen business days after the issue of that revised statement.

New.6.20(aa) and 3.6.20(ab) to be inserted after 3.6.20(a) as follows:

(aa) If the next final statement payment date occurs 10 business days or more after the issue of a revised statement under clause 3.6.19 then VENCorp must require payment of the adjustment under that revised statement to be made on that next final statement payment date.

(ab) If the next final statement payment date occurs less than 10 business days after the date of issue of a revised statement under clause 3.6.19 then VENCorp must require payment of the adjustment under that revised statement to be made on the final statement payment date following the next final statement payment date.

3.6.21 Payment default procedure(a) Each of the following events is a default event in relation to a Market Participant:

(1) the Market Participant does not pay any money due for payment by it under these Rules by the appointed time on the due date;



(2) VENCorp does not receive payment in full of any amount claimed by VENCorp under any credit support in respect of a Market Participant, within ninety minutes after the due time for payment of that claim;

(3) the Market Participant fails to provide credit support required to be supplied under these Rules by the appointed time on the due date;

(4) it is or becomes unlawful for the Market Participant to comply with any of its obligations under these Rules or any other obligation owed to VENCorp or it is claimed to be so by the Market Participant;

(5) it is or becomes unlawful for any Credit Support Provider in relation to the Market Participant to comply with any of its obligations under these Rules or any other obligation owed to VENCorp or it is claimed to be so by that Credit Support Provider;

(6) an authorisation from a government body necessary to enable the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant to carry on their respective principal businesses or activities ceases to have full force and effect;

(7) the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant ceases or is likely to cease to carry on its business or a substantial part of its business;

(8) the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant enters into or takes any action to enter into an arrangement (including a scheme of arrangement), composition or compromise with, or assignment for the benefit of, all or any class of their respective creditors or members, or a moratorium involving any of them;

(9) the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant states that it is unable to pay from its own money its debts as and when they fall due for payment;

(10) a receiver or receiver and manager is appointed in respect of any property of the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant;

(11) an administrator, provisional liquidator, liquidator, trustee in bankruptcy or person having a similar or analogous function is appointed in respect of the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant, or any action is taken to appoint any such person;

(12) an application or order is made for the winding up or dissolution or a resolution is passed or any steps are taken to pass a resolution for the winding up or dissolution of the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant;

(13) a notice under section 572 of the Corporations Law is given to the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant unless such application or order is rejected as being frivolous;

(14) the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant dies or is dissolved unless such notice of dissolution is discharged; and

(15) the Market Participant or a Credit Support Provider which has provided credit support for that Market Participant is taken to be insolvent or unable to pay its debts under any applicable legislation.



(b) Where a default event has occurred in relation to a Market Participant, VENCorp may:

(1) issue a default notice which specifies:

(A) the nature of the alleged default; and

(B) if VENCorp considers that the default is capable of remedy, that the Market Participant must remedy the default within 24 hours of the issue of the default notice; and/or

(2) immediately issue a suspension notice in accordance with clause 3.7.7 if VENCorp considers that the default is not capable of remedy and that failure to issue a suspension notice would be likely to expose other Market Participants to greater risk; and/or

(3) if it has not already done so, make a claim upon any credit support held in respect of the Market Participant for such amount as VENCorp determines represents the amount of any money actually or contingently owing by the Market Participant to VENCorp pursuant to these Rules.

(c) If:

(1) VENCorp considers that a default event is not capable of remedy in accordance with clause 3.6.21(b)(2); or

(2) a default event is not remedied within 24 hours of the issue of the default notice or any later deadline agreed to in writing by VENCorp; or

(3) VENCorp receives notice from the defaulting Market Participant that it is not likely to remedy the default specified in the default notice,

then VENCorp may issue a suspension notice in accordance with clause 3.7.7 under which VENCorp notifies the defaulting Market Participant that it is prohibited from doing all or any of the following things:

(4) submitting nominations, inc/dec offers and/or EoD linepack bids;

(5) injecting gas, or tendering gas for injection, into the transmission system; or

(6) withdrawing gas, or tendering gas for withdrawal, from the transmission system.

3.6.22 Maximum total payment in respect of a billing period

(a) For the purposes of this clause 3.6.22, the maximum total payment in respect of a billing period is equal to:

(1) the aggregate of the amounts received by VENCorp from Market Participants under clause 3.6.16 in respect of that billing period by 4.00 pm on the payment date; plus

(2) if one or more Market Participants are in default, the aggregate amount which VENCorp is able to obtain from the credit support provided by such Market Participants under clause 3.7 before 4.00 pm on the payment date; less

(3) the aggregate amount of all market fees and other payments received by VENCorp pursuant to clause 3.6.5(b)(4).

(b) For the purpose of clause 3.6.22(a), any payment received by VENCorp from a Market Participant in respect of a billing period shall be deemed to be made, and may be applied by VENCorp, in satisfaction of the market fees and other payments specified in clause 3.6.5(b)(4) payable to VENCorp by that Market Participant (as specified in the final statement issued to that Market Participant in respect of that billing period) before it is applied by VENCorp in satisfaction of any other obligation or liability.



(c) If the maximum total payment in respect of a billing period is not sufficient to meet the aggregate of the net amounts payable by VENCorp to each of the Market Participants to whom payments are to be made in respect of the billing period, then the amount payable by VENCorp to each relevant Market Participant in respect of that billing period is to be reduced by applying the following formula:

AAP = SAP x

where:

AAP is the reduced amount payable by VENCorp to the relevant Market Participant in respect of the relevant billing period;

SAP is the net amount that would have been payable to the relevant Market Participant for the relevant billing period but for the application of this clause 3.6.22.

A is the maximum total payment in respect of the billing period; and

B is the aggregate of the net amounts payable by VENCorp to Market Participants under clause 3.6.17 in respect of the billing period.

3.6.23 Interest on overdue amounts(a) A Market Participant or VENCorp, as the case may be, must pay interest on any unpaid

moneys due and payable by it under this clause 3.6.

(b) The rate of interest payable under clause 3.6.23(a) is the default interest rate calculated as simple interest on a daily basis from the date payment was due, up to and including the date on which payment is made, with interest compounding on monthly rests on the last day of each month whilst the unpaid moneys remain outstanding.



3.7 PRUDENTIAL REQUIREMENTS

3.7.1 PurposeThe purpose of the prudential requirements is to ensure the effective operation of the market by providing a level of comfort that Market Participants will meet their obligations to make payments as required under these Rules.

3.7.2 Provision of security(a) Subject to clause 3.7.2(c), a Market Participant must provide and maintain a security

complying with the requirements of this clause 3.7.

(b) If VENCorp believes it is likely that the amount payable by VENCorp to that Market Participant under these Rules in respect of a period will consistently exceed the amount payable to VENCorp by that Market Participant under these Rules in respect of that period, then VENCorp may exempt the Market Participant from the requirement to provide a security under clause 3.7.2(a) for that period.

(c) If, under clause 3.7.2(b), VENCorp has exempted a Market Participant from the requirement to provide a security under clause 3.7.2(a), then VENCorp may vary or cancel the exemption at any time by giving written notice of the variation or cancellation of the exemption to the Market Participant.

3.7.3 Form of securityThe security provided by a Market Participant under this clause 3.7 must be either:

(a) a bank guarantee in a form and from a bank acceptable to VENCorp; or

(b) another immediate, irrevocable and unconditional commitment in a form and from a bank or other institution acceptable to VENCorp.

3.7.4 Amount of security(a) Subject to clause 3.7.2(b), prior to the end of each financial year VENCorp must determine

and provide written confirmation to each Market Participant of that Market Participant’s minimum exposure, calculated as VENCorp’s reasonable estimate of the market fees payable by the Market Participant to VENCorp in respect of a billing period in the following financial year.

(b) VENCorp may review its determination of a Market Participant’s minimum exposure at any time, provided that any change to a Market Participant’s minimum exposure will apply no earlier than thirty days following notification by VENCorp to that Market Participant of that change or such earlier period agreed by the Board of Directors of VENCorp.

(c) Each Market Participant must procure that at all times the aggregate undrawn and unclaimed amounts of current and valid security held by VENCorp in respect of that Market Participant is not less than that Market Participant’s minimum exposure.

(d) To diminish the possibility of incurring a margin call under clause 3.7.10, a Market Participant may in its absolute discretion provide to VENCorp a security or securities in accordance with clause 3.7.3 for an aggregate amount which exceeds its minimum exposure.



3.7.5 Replacement security(a) If:

(1) an existing security provided by a Market Participant under this clause 3.7 is due to expire or terminate; and

(2) after that security expires or terminates, the maximum amount which VENCorp will be entitled to be paid in aggregate under any remaining security or securities provided by the Market Participant under this clause 3.7 will be less than Market Participant’s minimum exposure,

then the Market Participant must deliver to VENCorp, at least ten business days prior to the time at which that existing security is due to expire or terminate, a replacement security which:

(3) is of sufficient value to enable the Market Participant to comply with clause 3.7.4(c);

(4) complies with the requirements of this clause 3.7; and

(5) will take effect no later than the date on which the existing security is due to expire or terminate.

(b) If:

(1) a Market Participant fails to comply with clause 3.7.5(a); and

(2) that Market Participant does not remedy that failure within 24 hours after being notified by VENCorp of the failure,

then VENCorp must give the Market Participant a suspension notice in accordance with clause 3.7.7.

3.7.6 Drawdown of security(a) If VENCorp exercises its rights in accordance with clause 3.6.21 under a security provided

by a Market Participant under this clause 3.7, then VENCorp must notify the Market Participant.

(b) If, as a result of VENCorp exercising its rights under a security provided by a Market Participant under this clause 3.7, the maximum amount which VENCorp is entitled to be paid under the security or securities provided by the Market Participant under this clause 3.7 is less than the Market Participant’s minimum exposure, then, within 24 hours of receiving a notice under clause 3.7.6(a), the Market Participant must provide an additional security to ensure that at all times, it complies with the requirements of this clause 3.7.

(c) If a Market Participant fails to comply with clause 3.7.6(b) within the time period referred to in that clause, then VENCorp must give the Market Participant a suspension notice in accordance with clause 3.7.7.

3.7.7 Suspension of a Market Participant(a) As soon as practicable after a suspension notice is issued by VENCorp under these Rules,

VENCorp must:

(1) publish the suspension notice; and

(2) place a notice in a newspaper generally circulating in Victoria stating that the Market Participant has been suspended.

(b) VENCorp must revoke a suspension notice if:

(1) in the case of a default event, the default event is remedied; or



(2) in the case of a failure to maintain compliance with prudential requirements under this clause 3.7, that failure has been remedied; and

(3) there are no other circumstances in existence which would entitle VENCorp to issue a suspension notice,

except that VENCorp must not revoke a suspension notice more than one month after it was issued.

(c) If a suspension notice is revoked, VENCorp must publicise that fact in the same manner in which the suspension notice was publicised in accordance with clause 3.7.7(a).

(d) From the time that VENCorp issues a suspension notice to a Market Participant under these Rules, the Market Participant is ineligible to submit nominations, inc/dec offers or EoD linepack bids to the extent specified in the notice, until such time as VENCorp notifies the Market Participant and all other relevant Market Participants that the suspension has been revoked.

(e) A Market Participant must comply with a suspension notice issued to it under these Rules.

(f) Following the issue of a suspension notice to a Market Participant, VENCorp may do all or any of the following to give effect to the suspension notice:

(1) reject any nomination, inc/dec offer or EoD linepack bid submitted by that Market Participant;

(2) refuse to accept delivery of any gas injected, or tendered for injection, by that Market Participant;

(3) take such action as VENCorp considers necessary to prevent that Market Participant from injecting or withdrawing gas, including without limitation taking any action necessary to curtail the supply of gas to that Market Participant; and

(4) withhold the payment of any amounts otherwise due to that Market Participant under these Rules.

(g) If VENCorp does any of the things referred to in clause 3.7.7(f) it must promptly publish a notice of that fact.

(h) If:

(1) VENCorp has issued a suspension notice to a Market Participant due to a default event and in VENCorp’s reasonable opinion the Market Participant is incapable of rectifying the default event for any reason; or

(2) VENCorp has issued a suspension notice to a Market Participant due to a failure by the Market Participant to continue to satisfy the prudential requirements and in VENCorp’s reasonable opinion the Market Participant is incapable of rectifying that failure for any reason,

VENCorp must deregister that Market Participant as soon as practicable and promptly publish a notice of that fact.

3.7.8 Trading limits(a) Subject to clause 3.7.8(b), VENCorp must set a trading limit for each Market Participant.(b) If, under clause 3.7.2(c), VENCorp has exempted a Market Participant from the

requirement to provide a security under clause 3.7.2(b) for a period, then VENCorp must not set a trading limit for that Market Participant for the period during which that exemption applies.

(c) The trading limit for a Market Participant at any time must not be less than the greater of:



(1) the Market Participant’s minimum exposure; and

(2) a level determined and published by VENCorp in consultation with Market Participants.

3.7.9 Monitoring(a) Each day, VENCorp must review its actual exposure to each Market Participant in respect

of previous billing periods under these Rules.MSO Rules Amendments to facilitate Full Retail Contestability:




(a) Each day, VENCorp must review its actual estimated exposure to each Market Participant in respect of previous billing periods under these Rules.

(b) In calculating VENCorp’s actual exposure to a Market Participant under clause 3.7.9(a), the period between the start of the billing period in which the review occurs and the start of the gas day immediately following the day on which the review occurs is to be treated as a previous billing period.





(b) In calculating VENCorp’s actual estimated exposure to a Market Participant under clause 3.7.9(a), the period between the start of the billing period in which the review occurs and the start of the gas day immediately following the day on which the review occurs is to be treated as a previous billing period.

(c) In calculating VENCorp’s actual exposure to a Market Participant under clause 3.7.9(a), VENCorp must take into account:

(1) outstanding settlement amounts for the Market Participant in respect of previous billing periods; and

(2) settlement amounts for the Market Participant for trading intervals from the start of the billing period in which the review occurs to the end of the gas day on which the review occurs based on:

(A) actual market prices or, if actual market prices are not available for all or part of a gas day, the market prices forecast for the relevant gas day as published in the relevant final operating schedule determined by VENCorp in accordance with clause 3.1.12; and

(B) actual metered quantities for the Market Participant or, if actual metered quantities are not available for a trading interval, then a trading imbalance



for that trading interval determined by VENCorp based on substituted or available profiled metering data in accordance with procedures developed and published from time to time by VENCorp in consultation with Market Participants.





(c) In calculating VENCorp’s actual estimated exposure to a Market Participant under clause 3.7.9(a), VENCorp must take into account:

(1) outstanding settlement amounts for the Market Participant in respect of previous billing periods; and

(2) settlement amounts for the Market Participant for trading intervals from the start of the billing period in which the review occurs to the end of the gas day on which the review occurs based on:

(A) actual market prices or, if actual market prices are not available for all or part of a gas day, the market prices forecast for the relevant gas day as published in the relevant final operating schedule determined by VENCorp in accordance with clause 3.1.12; and

(B) actual metered quantities for the Market Participant or, if actual metered quantities are not available for a trading interval, then a trading imbalance for that trading interval determined by VENCorp based on substituted or available profiled metering data in accordance with procedures developed and published from time to time by VENCorp in consultation with Market Participants. for metering installations, the actual metering data or if actual metering data is not available then metering data substituted by VENCorp in accordance with clause 4.4.24; and

(C) data provided to VENCorp in accordance with the Retail Gas Market Rules.

(d) If VENCorp calculates that its actual exposure to a Market Participant exceeds the greater of


(2) 80% of the Market Participant’s trading limit, then VENCorp must inform the Market Participant accordingly.







(d) If VENCorp calculates that its actual estimated exposure to a Market Participant exceeds the greater of


(2) 80% of the Market Participant’s trading limit,

then VENCorp must inform the Market Participant accordingly.

3.7.10 Margin calls(a) If VENCorp calculates that its exposure to a Market Participant exceeds the Market

Participant’s trading limit, then VENCorp must make a margin call on that Market Participant by notice to the Market Participant.

(b) If VENCorp makes a margin call on a Market Participant under clause 3.7.10(a), then the Market Participant must satisfy the margin call within the period determined in accordance with clause 3.7.10(c) by either:

(1) providing to VENCorp an additional security or securities complying with the requirements of this clause 3.7 which enables VENCorp to increase the Market Participant’s trading limit to a level which exceeds VENCorp’s actual exposure to the Market Participant; or

(2) prepaying a portion of the amount payable or which will become payable in respect of previous billing periods sufficient to reduce VENCorp’s actual exposure to the Market Participant to below the Market Participant’s trading limit.





(b) If VENCorp makes a margin call on a Market Participant under clause 3.7.10(a), then the Market Participant must satisfy the margin call within the period determined in accordance with clause 3.7.10(c) by either:

(1) providing to VENCorp an additional security or securities complying with the requirements of this clause 3.7 which enables VENCorp to increase the Market Participant’s trading limit to a level which exceeds VENCorp’s actual estimated exposure to the Market Participant; or

(2) prepaying a portion of the amount payable or which will become payable in respect of previous billing periods sufficient to reduce VENCorp’s actual estimated exposure to the Market Participant to below the Market Participant’s trading limit.



(c) The period within which a margin call must be satisfied under clause 3.7.10(b) is:

(1) if the margin call is made on a business day before 10:00 am, then the period commences at the time the margin call is made and finishes at 2:00 pm on that business day; and

(2) if clause 3.7.10(c)(1) does not apply, then the period commences when the margin call is made and ends at 10:00 am on the first business day to occur after the margin call is made.

(d) For the purposes of these Rules, a prepayment under clause 3.7.10(b)(2) is taken to relate to the earliest billing period in respect of which the relevant Market Participant owes VENCorp an amount of money under these Rules and, if the amount the Market Participant owes under these Rules in respect of that billing period is less than the amount of the prepayment, then the excess is taken to relate to the billing periods occurring immediately after the earliest billing period in respect of which the relevant Market Participant owes VENCorp an amount of money under these Rules in chronological order until there is no excess.

(e) If a Market Participant fails to satisfy a margin call by providing an additional security or making a prepayment under clause 3.7.10(b) within the time referred to in that clause, then VENCorp must give the Market Participant a suspension notice.

3.7.11 ConfidentialityAll information provided by a Market Participant in relation to its financial circumstances must be treated by VENCorp as confidential information in accordance with clause 5.4.



3.8 GST

3.8.1 InterpretationTerms used in this clause 3.8 have the same meaning given to those terms in the GST Act, unless provided otherwise.

3.8.2 Application of GST(a) Unless stated otherwise, and subject to clause 3.8.2(b), monetary amounts determined,

published, notified or referred to under these Rules do not include GST.

(b) In determining amounts payable by or to persons under these Rules, VENCorp will include appropriate provision for the application of GST taking into account entitlement to input tax credits on amounts incurred, where applicable and consistent with the GST Act.

3.8.3 Co-operation(a) Each Participant must provide reasonable co-operation, if requested by VENCorp to do so,

to ensure efficient compliance with laws relating to the GST.

(b) VENCorp must provide reasonable co-operation, if requested by a Participant to do so, to ensure that Participant’s efficient compliance with laws relating to the GST.



CHAPTER 4. TECHNICAL MATTERS



4.1 CONNECTION TO THE TRANSMISSION SYSTEM

4.1.1 Statement of purposeThis clause 4.1:

(a) provides the framework for connection to the transmission system; and

(b) has the following aims:

(1) to detail the principles and guidelines governing connection to the transmission system;

(2) to establish the process to be followed by a Transmission Pipeline Owner and a Connection Applicant to establish or modify a connection to the transmission system; and

(3) to establish the system operation and security requirements for connection to the transmission system.

4.1.2 PrinciplesThis clause 4.1 is based on the following principles relating to connection to the transmission system:

(a) All persons shall have the opportunity to form a connection to the transmission system and have access to the services provided by the transmission system.

(b) The terms and conditions on which connection to the transmission system and provision of connection services are to be set out in a commercial agreement to be entered into between the relevant Transmission Pipeline Owner and the Connection Applicant.

(c) If requested by a Connected Party or by the relevant Transmission Pipeline Owner, the relevant Transmission Pipeline Owner and the Connected Party must document the terms of any connection arrangements made prior to the commencement date and the resulting document will then be deemed to be a connection agreement for the purposes of these Rules.

(d) This clause 4.1 applies to:

(1) all connection agreements made after the commencement date;

(2) all deemed connection agreements created pursuant to clause 4.1.2(c); and

(3) all requests to establish connection or modify an existing connection after the commencement date.

(e) This clause 4.1 is not intended to, nor is it to be read or construed as having the effect of:

(1) altering any of the terms of a connection agreement made prior to the commencement date; or

(2) altering the contractual rights or obligations of any of the parties under a connection agreement as between the relevant Transmission Pipeline Owner and the Connected Party made prior to the commencement date; or

(3) relieving the parties to a connection agreement made prior to the commencement date of their contractual obligations under that agreement.

(f) Subject to clause 4.1.2(e), if any right or obligation of a Connected Party under a connection agreement is inconsistent with any provision of these Rules, the provisions of these Rules shall prevail.

4.1.3 Obligations of the Transmission Pipeline Owner



A Transmission Pipeline Owner must:

(a) receive and process applications for connection or modification of a connection which are submitted to it and must enter into a connection agreement with each Connected Party and any other person to which it has provided a connection in accordance with this clause 4.1;

(b) ensure that every connection agreement to which it is a party complies with, and is not inconsistent with, this clause 4.1;

(c) consult with VENCorp regarding the system operation and security requirements of proposed connections to its pipeline; and

(d) use its reasonable endeavours to comply with all reasonable requests of the Connection Applicant relating to its connection requirements.

4.1.4 Obligations of VENCorpVENCorp must:

(a) review all proposed connections from a system operation and security perspective;

(b) establish system operation and security standards and requirements for connections; and

(c) use its reasonable endeavours to comply with all reasonable requirements of the Connection Applicant and the relevant Transmission Pipeline Owner relating to the commissioning of connection equipment.

4.1.5 Obligations of Connected Parties(a) Each Connected Party must ensure that all connection equipment which is owned,

operated or controlled by it at all times comply with applicable requirements and conditions for connection in accordance with its connection agreement with the Transmission Pipeline Owner.

(b) A Connection Applicant must:

(1) comply with the reasonable requirements of the Transmission Pipeline Owner in respect of the design requirements of connection equipment proposed to be connected to the transmission system;

(2) not make any material modification or addition to any connection equipment which is the subject of a connection agreement without the prior written consent of the relevant Transmission Pipeline Owner and VENCorp;

(3) provide load forecast information to the relevant Transmission Pipeline Owner and VENCorp in accordance with clause 4.1.6(c); and

(4) allow the Transmission Pipeline Owner to participate in the commissioning of connection equipment which is to be connected to the transmission system.

4.1.6 Application for connection(a) A person who wishes to connect to the transmission system may make an application to

connect in accordance with this clause 4.1.6.

(b) An application to connect made by a person who wishes to connect to the transmission system must contain the information specified in clause 4.1.6(c) and must be submitted, together with the relevant application fee, to the relevant Transmission Pipeline Owner.

(c) The connection application must include:



(1) details of the location of the connection point and proposed specifications of the connection equipment;

(2) the date by which the connection is desired;

(3) details of the forecast load requirements of the connection point, including maximum daily quantity, maximum hourly quantity and maximum and minimum operating pressures; and

(4) such other information as the relevant Transmission Pipeline Owner may reasonably request to enable it to assess the application to connect and prepare an offer to connect.

(d) Within six months of the commencement date, VENCorp must determine the relevant application fee (if any) payable under clause 4.1.6(b) by a person making an application to connect to the transmission system.

4.1.7 VENCorp to approve application in principle(a) The relevant Transmission Pipeline Owner must submit details of the load requirements of

the proposed connection point (including the information referred to in clause 4.1.6(c)) to VENCorp for approval and for allocation of any available authorised MDQ to the Connection Applicant in accordance with clause 5.3 as soon as reasonably practicable and in any event within twenty business days of receipt of an application to connect (or within such longer period as the relevant Transmission Pipeline Owner and the Connection Applicant may agree).

(b) Within twenty business days of receipt of a proposal for a connection, VENCorp must approve or reject the proposed connection in accordance with principles and procedures in the guidelines referred to in clause 4.1.7(f) and give notice of the approval or rejection to the relevant Transmission Pipeline Owner.

(c) VENCorp may reject a proposed connection if the proposed connection or modified connection does not meet the system operation and security and other requirements specified in the guidelines referred to in clause 4.1.7(f).

(d) If VENCorp rejects a proposed connection, VENCorp must notify the relevant Transmission Pipeline Owner of its reasons for doing so.

(e) The relevant Transmission Pipeline Owner and the Connection Applicant must provide VENCorp with any information which VENCorp may reasonably request to enable it to assess the proposed connection.

(f) In consultation with Participants VENCorp must develop and update from time to time guidelines for the approval of new or modified connections to the transmission system.

(g) The guidelines referred to in clause 4.1.7(f) must:

(1) contain the principles and procedures and the system operation and security requirements used for approving or rejecting a proposed connection referred to in clause 4.1.7(b); and

(2) must be published and provided to Participants and interested persons on request.

4.1.8 Offer to connect(a) Within twenty business days after the proposed connection has been approved in principle

by VENCorp (or such longer period as the relevant Transmission Pipeline Owner and the Connection Applicant may agree), the relevant Transmission Pipeline Owner must prepare and make an offer to connect the Connection Applicant’s pipeline to the transmission system.



(b) The offer to connect must contain the proposed terms and conditions for connection to the transmission system.

(c) The offer to connect must be fair and reasonable and must be consistent with the safe and reliable operation of the transmission system in accordance with these Rules.

(d) The relevant Transmission Pipeline Owner must use its reasonable endeavours to provide the Connection Applicant with an offer to connect in accordance with the reasonable requirements of the Connection Applicant, including without limitation, the location and load requirements of the proposed connection point.

(e) Both the relevant Transmission Pipeline Owner and the Connection Applicant are entitled to negotiate with each other in respect of the provision of connection and any other matters relevant to the provision of connection. If negotiations occur, the relevant Transmission Pipeline Owner and the Connection Applicant must conduct such negotiations in good faith.

(f) The offer to connect must define the basis for determining transmission connection charges in accordance with the relevant Transmission Pipeline Owner’s access arrangement, if any.

4.1.9 Finalisation of connection agreements(a) If the Connection Applicant accepts an offer to connect, the Connection Applicant must:

(1) agree to be bound by all relevant provisions of these Rules; and

(2) subject to clause 4.1.10, enter into a connection agreement with the relevant Transmission Pipeline Owner.

(b) The provision of connection by the relevant Transmission Pipeline Owner may be made subject to gaining environmental, planning or other regulatory or statutory approvals for any pipeline equipment or connection equipment.

(c) Each connection agreement must be based on the offer to connect as varied by agreement between the parties.

4.1.10 Approval of connection agreements by VENCorp(a) A Transmission Pipeline Owner and a Connection Applicant must not enter into a

connection agreement unless it has been approved by VENCorp.

(b) A Transmission Pipeline Owner must submit each connection agreement which it proposes to enter into with a Connection Applicant, in the form agreed by the relevant Transmission Pipeline Owner and the Connection Applicant, to VENCorp within two business days after the terms of the proposed connection agreement have been agreed by the relevant Transmission Pipeline Owner and the Connection Applicant.

(c) The relevant Transmission Pipeline Owner must, at the same time as it submits a connection agreement for approval by VENCorp, either:

(1) confirm that there has been no material change to the information provided to VENCorp pursuant to clause 4.1.7 in relation to the proposed connection; or

(2) provide VENCorp with full details of the load requirements of the proposed connection point to the extent that such requirements differ from the requirements submitted to VENCorp pursuant to clause 4.1.7 and any other change to the information provided to VENCorp pursuant to that clause.

(d) Within ten business days of receipt by VENCorp of a proposed connection agreement pursuant to clause 4.1.10(b), VENCorp must approve the proposed connection agreement or reject the proposed connection agreement.



(e) VENCorp may reject a proposed connection agreement if:(1) in VENCorp’s reasonable opinion, the proposed connection which is the subject of

that connection agreement has potential to adversely and materially affect the operation or security of the transmission system; or

(2) it does not comply with, or is inconsistent with, any provision of these Rules.

(f) The relevant Transmission Pipeline Owner and the Connection Applicant must provide VENCorp with any information which VENCorp may reasonably request to enable it to assess the proposed connection agreement.

4.1.11 ConsultationThe relevant Transmission Pipeline Owner must consult with VENCorp in relation to a proposed connection prior to submission of the proposed connection agreement relating to that connection for approval by VENCorp with the intent of facilitating the approval by VENCorp of that connection agreement.

4.1.12 Confidential information(a) All data and information provided by a Transmission Pipeline Owner or a Connection

Applicant under this clause 4.1 must be:

(1) prepared, given and used in good faith;

(2) treated as confidential information; and

(3) protected from being disclosed or made available by the recipient to a third party, except for the purpose of enabling the relevant Transmission Pipeline Owner and VENCorp to assess the application for connection.

(b) If a Connection Applicant or relevant Transmission Pipeline Owner becomes aware of any material change to any information contained in or relevant to an application to connect then it must promptly notify the other party in writing of that change.

4.1.13 System balancing arrangements(a) VENCorp may require, as a condition of connection of a transmission pipeline to the

transmission system, that the Interconnecting Pipeline Owner which operates the transmission pipeline which is proposed to be connected must enter into an agreement with VENCorp relating to the operation of their respective transmission pipeline systems and an Interconnecting Pipeline Owner must comply with any such requirement.

(b) An agreement referred to in clause 4.1.13(a), may make arrangements relating to, amongst other things:

(1) the balancing, monitoring and regulation of gas flows between the transmission system and the pipeline which is proposed to be connected;

(2) the scheduling of gas flows in accordance with the nominations and inc/dec offers of Market Participants who wish to transport gas across the transfer point at which the Interconnected Pipeline Owner’s pipeline is connected to the transmission system;

(3) the maintenance of a balancing account;

(4) the deployment of system capacity and system optimisation;

(5) operating pressures; and

(6) the maintenance of the security of the transmission system and the transmission pipeline which is proposed to be connected.



4.1.14 InterpretationFor the purpose of this clause 4.1, in relation to a connection, a reference to a “relevant Transmission Pipeline Owner” is to be construed as a reference to the Transmission Pipeline Owner which owns or controls the pipeline to which that connection relates or which is the subject of that connection.



4.2 LNG STORAGE

4.2.1 Purpose of this clauseThis clause 4.2 sets out:

(a) the obligations of the LNG Storage Provider relating to the operation of the LNG storage facility and the provision of LNG storage capacity;

(b) the responsibilities of VENCorp relating to the LNG reserve;

(c) the rights and obligations of Market Participants who hold LNG storage capacity;

(d) requirements relating to the transfer of LNG storage capacity and LNG stock; and

(e) the rights and obligations of VENCorp, the LNG Storage Provider and Market Participants relating to the maintenance of sufficient LNG stock to ensure the security of the transmission system and to satisfy VENCorp’s operational requirements.

4.2.2 Obligations of VENCorp(a) VENCorp is responsible for scheduling LNG injection offers and managing the LNG

reserve.

Clauses 4.2.2(b), (c) and (d) deleted by notice in the Government Gazette dated 28 February 2002

4.2.3 Obligations of the LNG Storage Provider(a) The LNG Storage Provider must ensure that, subject to the terms and conditions of these

Rules and the right of Market Participants who hold LNG storage capacity to make LNG injection offers, the LNG storage facility is utilised with the objective of maintaining LNG stock at the highest level possible.

(b) The LNG Storage Provider must operate the LNG storage facility in accordance with the scheduling instructions issued by VENCorp in accordance with these Rules.

(c) The LNG Storage Provider must maintain a register of the holders of LNG storage capacity and register transfers of LNG storage capacity and LNG stock in accordance with clauses 4.2.5 and 4.2.6.

4.2.4 BOC Agreement(a) The LNG Storage Provider must, subject to the terms and conditions of the BOC

Agreement, keep VENCorp informed in a timely manner of all matters or circumstances relating to the BOC Agreement or the operation of the LNG storage facility which may affect the ability of VENCorp to schedule LNG injection offers or use the LNG reserve.

(b) The LNG Storage Provider must notify VENCorp on or before the twelfth day of each month of the following information relating to the operation of the BOC Agreement:(1) the minimum and maximum quantity of gas which the LNG Storage Provider may

order for liquefaction by BOC in the following month under the BOC Agreement; and

(2) if known, BOC’s requirements for gas and LNG stock in the following month.

(c) If any provision of these Rules with which the LNG Storage Provider is bound to comply is inconsistent with any term of the BOC Agreement, then the term of the BOC Agreement will prevail.



(d) The LNG Storage Provider must not terminate or vary the BOC Agreement without the consent of VENCorp (whose consent must not be unreasonably withheld or delayed).

4.2.5 LNG storage capacity(a) VENCorp must not do anything, or omit to do anything, which would adversely affect

BOC’s LNG storage entitlement under the BOC Agreement.(b) Unless and until VENCorp otherwise agrees, the LNG Storage Provider must make

available 3,000 tonnes of LNG storage capacity for the operation of the LNG reserve in accordance with clause 4.2.9.

(c) If VENCorp requests, any LNG storage capacity which is not required to be made available to BOC or is not allocated to Market Participants must be made available to VENCorp and will comprise part of the LNG reserve.

(d) A Market Participant must hold LNG storage capacity in order to use the LNG storage facility.

(e) The LNG Storage Provider must maintain and keep updated a register of holders of LNG storage capacity, which must include the following information:

(1) the identity of each holder of LNG storage capacity;

(2) the amount of storage space to which each holder of LNG storage capacity is entitled; and

(3) the quantity of LNG stock held on behalf of each holder of LNG storage capacity.

(f) The register of holders of LNG storage capacity may be maintained and stored in a computer or other electronic device or database.

4.2.6 Transfers of LNG storage capacity and LNG stock(a) A Market Participant may at any time:

(1) transfer all or part of its LNG storage capacity; or

(2) transfer all or part of its LNG stock,

to another Market Participant, subject to and in accordance with this clause 4.2.6.

(b) A Market Participant may not transfer LNG storage capacity or LNG stock if as a result the transferor or the transferee would have LNG stock in excess of the LNG storage capacity to which it is entitled.

(c) A transfer of LNG storage capacity and/or LNG stock may only be expressed to take effect on the start of a gas day and any such transfer which purports to take effect at any other time shall be invalid.

(d) The LNG Storage Provider must not reject a transfer in respect of which the requirements of this clause 4.2.6 are satisfied.

(e) Where a Market Participant proposes to make an LNG storage transfer, both the transferor and transferee must give notice of the proposed LNG storage transfer to the LNG Storage Provider, specifying:

(1) the identity of the transferor and the transferee;

(2) the amount of the LNG storage capacity and/or LNG stock the subject of the transfer; and

(3) the gas day on the commencement of which the LNG storage transfer is to be effective.



(f) A proposed LNG storage transfer must be notified to the LNG Storage Provider by the transferor and the transferee by no later than 7.00 am on the day on which the gas day specified in the notice referred to in clause 4.2.6(e)(3) starts.

(g) The LNG Storage Provider must:

(1) register an LNG storage transfer which complies with this clause 4.2.6 as soon as reasonably practicable after it has been received; and

(2) notify VENCorp of an LNG storage transfer and the amount of the LNG storage capacity and/or LNG stock transferred by no later than 8.00 am on the day on which the gas day starts on the commencement of which that LNG storage transfer is to be effective.

(h) The amount of LNG storage capacity and LNG stock which a Market Participant holds will be determined by the register of LNG storage capacity maintained by the LNG Storage Provider in accordance with clause 4.2.5(e). The LNG Storage Provider will not be required to have regard to any LNG storage capacity or LNG stock which a Market Participant purports to hold other than LNG storage capacity or LNG stock in respect of which that Market Participant is the registered holder.

(i) With effect from the commencement of the gas day on which a valid LNG storage transfer is expressed to take effect in accordance with clause 4.2.6(e)(3) the LNG stock which is the subject of a valid LNG storage transfer will be added to the transferee’s LNG stock and deducted from the transferor’s LNG stock.

(j) If for any reason a Market Participant ceases to be entitled to any LNG storage capacity, the LNG Storage Provider will, as soon as reasonably practicable after it becomes aware of the cessation, register that fact. Any LNG storage transfer which is notified to the LNG Storage Provider will be valid and capable of registration, notwithstanding that the transferor’s entitlement to the LNG storage capacity which is the subject of the LNG storage transfer has ceased, unless and until the cessation has been registered.

4.2.7 Liquefaction of gas(a) Unless VENCorp otherwise approves, the LNG Storage Provider must order, in respect of

each month, the maximum quantity of gas which it is entitled to require BOC to liquefy for storage in that month under the terms of the BOC Agreement.

(b) The quantity of gas made available to BOC for liquefaction and storage in the LNG storage facility during each trading interval as a result of an order made by the LNG Storage Provider pursuant to clause 4.2.7(a) shall be allocated to, and be deemed to have been made available by, VENCorp or the Market Participants who hold LNG storage capacity in the following order of priority:

(1) first, such quantity of gas shall be allocated to, and be deemed to have been made available by, VENCorp as may be necessary to ensure that the LNG reserve is maintained at the maximum level and that there is sufficient LNG stock for use by BOC in accordance with the terms of the BOC Agreement; and

(2) second, a proportion of the remaining quantity, if any, (after a quantity has been allocated to VENCorp pursuant to clause 4.2.7(b)(1)) shall be allocated to, and be deemed to be made available by, each Market Participant who holds LNG storage capacity in accordance with the following formula:

Q = QL x PAC TAC



where:

Q is the Market Participant’s allocation of the remaining quantity (if any) of gas made available to BOC for liquefaction and storage in a trading interval;

QL is the remaining quantity of gas (if any) made available to BOC for liquefaction and storage in that trading interval;

PAC is that Market Participant’s available LNG capacity at the start of that trading interval; and

TAC is the sum of all Market Participants available LNG capacity at the start of that trading interval.

(c) The LNG Storage Provider must determine the quantity of gas deemed to have been made available by VENCorp and each Market Participant to BOC for liquefaction during each trading interval and notify VENCorp of its determination as soon as reasonably practicable after the end of the relevant trading interval.

(d) To avoid doubt, any quantity of gas deemed to have been made available by a Market Participant to BOC during a trading interval in accordance with this clause 4.2.7 is to be taken into account for the purpose of calculating that Market Participant’s trading imbalance in that trading interval.

4.2.8 Vaporisation of LNG and LNG injection offers

Clauses 4.2.8(a) and (b) deleted by notice published in the Government Gazette dated 28 February 2002

(c) Subject to clause 4.2.8(d), VENCorp must schedule LNG injection offers in accordance with the provisions of clause 3.1.

(d) VENCorp must call on LNG injection offers by issuing scheduling instructions directly to the LNG Storage Provider and, to avoid doubt, VENCorp is not required to issue scheduling instructions to Market Participants in respect of their LNG injection offers.

(e) To avoid doubt, LNG stock held by Market Participants will only be vaporised in accordance with the LNG injection offers submitted by them and such Market Participants have no right to submit nominations in respect of the injection of vaporised LNG into the transmission system or any other right in respect of the withdrawal of LNG stock from storage.

4.2.9 LNG Reserve(a) VENCorp may utilise the LNG reserve by requiring the LNG Storage Provider to vaporise

LNG stock held by the LNG Storage Provider on its behalf at such times and in such quantities as VENCorp may reasonably consider necessary or desirable to ensure the security of the transmission system and to satisfy VENCorp’s operational requirements.

(b) The LNG Storage Provider must comply with all reasonable directions of VENCorp relating to the utilisation of the LNG reserve, including any direction to vaporise any LNG stock which comprises part of the LNG reserve.

Clause 4.2.8(c) deleted by notice published in the Government Gazette dated 28 February 2002

(d) VENCorp must consult with Market Participants and the LNG Storage Provider for the purpose of carrying out any review of the LNG reserve.



Clause 4.2.8(e) deleted by notice published in the Government Gazette dated 28 February 2002

(f) Any gas which is vaporised for testing of the LNG facility and boil off gas is to be treated as having been taken from the LNG reserve and included in the linepack account.

4.2.10 Provision of information(a) The LNG Storage Provider and VENCorp must establish and operate an information

exchange system allowing the electronic transfer of information between the LNG Storage Provider and VENCorp relating to the LNG storage facility.

(b) The specifications and requirements of the information exchange system referred to in clause 4.2.10(a) shall be as agreed between the LNG Storage Provider and VENCorp from time to time (such agreement not to be unreasonably withheld or delayed) and the cost of providing and maintaining that system shall be borne by the LNG Storage Provider and VENCorp in such proportions as they may agree from time to time (such agreement not to be unreasonably withheld or delayed).

(c) The information exchange system referred to in clause 4.2.10(a) must allow VENCorp to have access to the following information as soon as reasonably practicable after the end of each trading interval:(1) the quantity of gas which was made available to BOC for liquefaction during the

previous trading interval;(2) the quantity of LNG stock which is held in the LNG storage facility at the end of the

previous trading interval for use by BOC, VENCorp and each Market Participant who holds LNG storage capacity (after taking account of any gas made available for liquefaction by VENCorp and each Market Participant pursuant to clause 4.2.7(b) and liquefied during that trading interval and any LNG vaporised during that trading interval as a result of any scheduling instructions or any other direction by VENCorp);

(3) the quantity of gas which was made available to BOC for use in its LNG plant and air separation, nitrogen liquefaction, storage and other facilities and returned to the transmission system during the previous trading interval; and

(4) such other information relating to the operation of the LNG storage facility as VENCorp may reasonably require.

(d) VENCorp must, if requested by a Market Participant who holds LNG storage capacity, make available to that Market Participant the following information relating to that Market Participant (if and to the extent that such information is available to VENCorp):(1) the quantity of gas which was deemed to be made available by that Market

Participant to BOC for liquefaction during each trading interval;(2) the quantity of LNG stock held by the LNG Storage Provider on behalf of the

Market Participant at the end of each trading interval; and

(3) the quantity of LNG vaporised on behalf of the Market Participant during each trading interval.



4.3 GAS QUALITY

4.3.1 Principles(a) The quality specifications for gas which is delivered into the transmission system shall be

the uniform gas quality specifications prescribed by the Gas Quality Regulations, unless VENCorp determines otherwise.

(b) VENCorp is responsible for ensuring that any gas which is transferred from the transmission system to a distribution pipeline at a system withdrawal point complies with the prescribed specifications.

(c) VENCorp has the sole right to accept delivery of off-specification gas.

(d) Each Participant must use its reasonable endeavours to ensure that any gas which it injects or tenders for injection into the transmission system at a system injection point complies with the gas quality specifications for that system injection point.

(e) Gas quality monitoring is required at all system injection points and such other points on the transmission system as VENCorp may consider necessary or desirable to enable VENCorp to monitor the quality of gas injected into and withdrawn from the transmission system.

4.3.2 Gas quality standards at injection points(a) VENCorp may approve, in relation to a system injection point, a gas quality standard which

is different to the prescribed specifications and accept delivery of gas at that system injection point which complies with that gas quality standard if:

(1) all of the Market Participants who propose to inject gas which does not comply with the prescribed specifications into the transmission system at that system injection point have entered into a written contract:

(A) with one or more of the Market Participants who inject gas which complies with the prescribed specifications into the transmission system at another system injection point regarding the acceptance of the proposed gas quality standard to be co-mingled with their gas at the system injection point first referred to in this clause 4.3.2(a); or

(B) with a provider of gas processing services relating to the processing of the gas which does not comply with the prescribed specifications after that gas has been injected into the transmission system; and

(2) VENCorp approves that contract and is satisfied that under the terms of the contract gas which complies with that gas quality standard can be co-mingled with other gas in the transmission system or processed so that:

(A) gas transferred from the transmission system to each distribution pipeline at a system withdrawal point will, notwithstanding acceptance of gas which complies with that gas quality standard, comply with the prescribed specifications; and

(B) gas transferred from the transmission system to each Transmission Customer will, notwithstanding acceptance of gas which complies with that gas quality standard, comply with the gas quality standards agreed between VENCorp and each Transmission Customer in respect of its transmission delivery point.

(b) If at any time VENCorp considers that any contract which it has approved pursuant to clause 4.3.2(a) is not being complied with in any respect or that the conditions specified in



clause 4.3.2(a)(2) can no longer be satisfied in respect of gas which is the subject of any such contract:

(1) VENCorp must notify each Market Participant who injects gas into the transmission system at the relevant system injection point that the gas quality standard approved by VENCorp pursuant to clause 4.3.2(a) in respect of that system injection point is no longer approved and specify a time with effect from which gas injected into the transmission system at that system injection point must comply with the prescribed regulations;

(2) each Market Participant must not, at any time after the time specified in the notice referred to in clause 4.3.2(b)(1), inject gas, or tender gas for injection, at the relevant system injection point which does not comply with the prescribed specifications; and

(3) VENCorp may refuse to accept gas into the transmission system at the relevant system injection point which does not comply with the prescribed specifications.

(c) Subject always to clauses 4.3.2(a) to (b) (inclusive), VENCorp may approve, in relation to a transmission delivery point, a gas quality standard which is different from the prescribed specifications if that gas quality standard has been agreed by all Participants who withdraw gas at that transmission delivery point.

4.3.3 Gas quality monitoring(a) A gas quality monitoring system must:

(1) be provided by the Transmission Pipeline Owner at each system injection point and such other points on the transmission system as VENCorp may consider necessary or desirable to enable VENCorp to monitor the quality of gas injected and withdrawn from the transmission system; and

(2) be paid for by the Transmission Pipeline Owner, unless otherwise agreed by the Transmission Pipeline Owner and the Connected Party associated with that monitoring point.

(b) The gas quality monitoring system must be approved by VENCorp.

(c) The gas quality monitoring system must provide for the continuous measurement of gas quality and the continuous transmission of gas quality data in real time to the metering database unless VENCorp agrees that, having regard to the characteristics of the particular monitoring point, satisfactory measurement can be achieved by sampling or some means other than continuous measurement.

(d) The gas quality monitoring system must include the following equipment:

(1) a gas chromatograph for determination of gas composition, heating value, relative density and wobbe index;

(2) an oxygen analyser for determination of the oxygen content;

(3) a sulphur analyser for determination of hydrogen-sulphide and total sulphur; and

(4) a water analyser,

unless VENCorp agrees otherwise, having regard to alternate measuring methods or the characteristics of the particular gas supply.

(e) The provider of a gas quality monitoring system must ensure that, at its own cost, data from the gas quality monitoring system is transmitted to the metering database in a form and manner compatible with the metering database.



(f) The provider of the gas quality monitoring system must submit to VENCorp for approval a plan to ensure the accuracy and reliability of the gas quality monitoring system. The plan must include:

(1) provision for the periodic testing and calibration of the gas quality monitoring system in accordance with standards approved by VENCorp;

(2) procedures ensuring that the gas quality monitoring system will remain free from interference; and

(3) provision for the storing of all data relating to the operation and calibration of the gas quality monitoring system.

(g) The provider of the gas quality monitoring system must provide VENCorp and any other affected Participant with all data and information relating to gas quality at the monitoring point, including all test and calibration reports relating to the gas quality monitoring system, on request. The party requesting the information must pay the provider’s reasonable costs of providing that information.

4.3.4 Off-specification gas(a) Each Participant must use its reasonable endeavours to ensure that any gas which it

injects or tenders for injection into the transmission system at a system injection point complies with the gas quality specifications for that system injection point.

(b) If VENCorp is aware that off-specification gas is being, or is likely to be, or has been injected by a Participant at a system injection point, VENCorp may refuse to accept delivery or continued delivery of all or some of the off-specification gas for such period as VENCorp may determine.

(c) VENCorp must not refuse to accept, on quality grounds, delivery of gas at a system injection point which complies with the gas quality specifications for that system injection point.

(d) Each Participant must notify VENCorp as soon as it becomes aware that gas which does not comply with the gas quality specifications is being, or is likely to be, or has been delivered at a system injection point. Any such notification must include all information which is available to the Participant in respect of the off-specification gas, including each aspect of each specification with which it fails to comply, the degree of its failure to comply and the likely time at which the Participant will be able to resume delivery of gas in accordance with the gas quality specifications.

(e) VENCorp may accept delivery of off-specification gas if, in the reasonable opinion of VENCorp:

(1) acceptance is necessary to ensure the safety of the public or the security of the transmission system; or

(2) off-specification gas can be co-mingled with other gas in the transmission system or processed so that:

(A) gas transferred from the transmission system to each distribution pipeline at a system withdrawal point will, notwithstanding acceptance of that off-specification gas, comply with the prescribed specifications; and

(B) gas transferred from the transmission system to each Transmission Customer will, notwithstanding acceptance of that off-specification gas, comply with the gas quality standards agreed between VENCorp and each Transmission Customer in respect of its transmission delivery point.

(f) If VENCorp accepts or intends to accept any off-specification gas in accordance with clause 4.3.4(e), it must promptly give notice of that fact to each Participant who VENCorp



reasonably believes is likely to be affected by gas which does not comply with the prescribed specifications or the gas quality standard agreed by VENCorp in respect of a transmission delivery point and, so far as known, the extent to which gas is likely to fail to comply with the prescribed specifications or such gas quality standard and the likely quantity and duration of such off specification gas.



4.4 METERING

4.4.1 Introduction to the metering rules(a) This clause 4.4 applies to the following Participants:

(1) Producers;

(2) Transmission Pipeline Owners;

(3) Interconnected Pipeline Owners;

(4) Distributors;

(5) Retailers;(6) Transmission Customers; (7) Market Customers; and

(8) Storage Providers (b) This clause 4.4 sets out the metering requirements:

(1) for connection points on the transmission system; (2) for distribution delivery points at which gas is withdrawn by:

(A) Market Customers; and

(B) Customers who are purchasing that gas in its entirety from a person other than the Local Retailer; and

(3) for distribution delivery points as determined by VENCorp:

(A) for the purposes of giving effect to an allocation algorithm developed in accordance with clause 3.5.4; or

(B) for which metering data is otherwise required for the purpose of settlement.

(4) for receipt points on a distribution pipeline.MSO Rules Amendments to facilitate Full Retail Contestability:



4.4.1(b) is to be altered as follows:

(b) This clause 4.4 requires the following connection points to have metering installations:

(1) connection points on the transmission system;

(2) distribution delivery points at which gas is withdrawn by Market Customers;

(3) other distribution delivery points as reasonably determined by VENCorp as required for the operation of the transmission system or for settlement; and

(4) receipt points on a distribution pipeline.

(c) The purpose of this clause 4.4 is to set out the rights and obligations of the Participants described in clause 4.4.1(a) relating to the measurement of volumes and quantities of gas and the provision of data for the operation of the market.



(d) This clause 4.4 sets out provisions relating to:

(1) metering installations used for the measurement of volumes and quantities of gas;

(2) the provision, installation and maintenance of metering equipment;

(3) the accuracy of metering equipment;

(4) metering calibration requirements;

(5) the provision of metering data for the purpose of settlements;

(6) the security of, and rights of access to, metering data; and

(7) standards of performance of metering installations.

(e) The key principles adopted in this clause 4.4 are:

(1) each:

(A) connection point on the transmission system;

(AA) receipt point on a distribution pipeline;

(B) distribution delivery point at which gas is withdrawn by a Market Customer or a Customer who is purchasing gas in its entirety from a person other than the Local Retailer; and

(C) distribution delivery point as determined by VENCorp for the purposes of giving effect to an allocation algorithm developed in accordance with clause 3.5.4,

(D) distribution delivery point for which metering data is otherwise required by VENCorp for the purpose of settlement,

must have a metering installation;MSO Rules Amendments to facilitate Full Retail Contestability:



Delete 4.4.1(e)(1) without replacement

(2) subject to clause 4.4.1(e)(3), costs associated with a metering installation are to be borne by the responsible person, provided that the responsible person may agree with an affected Participant, either generally or in any particular case, that those costs are instead to be borne (in whole or in part) by that affected Participant;

(3) subject to any agreement to the contrary, the reasonable costs associated with:

(A) new metering installations;

(B) modifications to existing metering installations; or

(C) decommissioning of metering installations,

are to be borne by the affected Participant to the extent that those costs arise from new, increased or reduced gas demand of, or supply to, that affected Participant, unless the Regulator otherwise determines either generally or in any particular case;



(4) the responsible person must ensure that the accuracy of a metering installation:

(A) used to measure the consumption of a transmission delivery point complies with the relevant standards prescribed in this clause 4.4; and

(B) used to measure the consumption of a distribution delivery point complies with the relevant standards prescribed in the Distribution System Code.

(5) the accuracy of the metering installation at each metering point is to be determined by reference to the volume of gas passing through that metering point;

(6) metering installations must be:

(A) secure;

(B) registered with VENCorp;

(C) capable of providing metering data for transmission or collection and delivery to the metering database in accordance with this clause 4.4; and

(D) installed, connected, commissioned, operated, checked and maintained in accordance with this clause 4.4 and in accordance with any applicable laws;

(7) metering installations must be capable of recording metering data in hourly intervals;

(8) the responsible person must calibrate:

(A) a metering installation at a transmission delivery point in accordance with clause 4.4.9; and

(B) a metering installation at a distribution delivery point in accordance with the accuracy limits set out in the Distribution System Code;

(9) quantities of gas are to be quantified by reference to their energy content and stated in units of joules or multiples thereof;

(10) the electronic accessibility of each metering installation must be co-ordinated by the responsible person to prevent congestion;

(11) VENCorp is responsible for creating, maintaining and administering the metering database;

(12) Market Participants are entitled to access to the metering database in respect of injections or withdrawal of gas for which they are financially responsible;

(13) each Transmission Pipeline Owner is entitled to access metering data in respect of metering points on its pipeline;

(14) each Interconnected Pipeline Owner is entitled to access metering data in respect of a metering point at a transfer point at which its transmission pipeline is connected;

(15) each Distributor is entitled to access metering data in respect of metering points on its pipeline and metering points at connection points between the transmission system and its pipeline;

(16) metering data used in settlement statements is to be validated in accordance with clause 4.4.24;

(17) other meters may be installed by and at the expense of an affected Participant and used to check metering installations VENCorp may at its discretion use data from such other meters where it detects a loss of metering data or incorrect metering data from a metering installation;



(18) VENCorp must maintain metering data which is transmitted or otherwise collected from metering installations and delivered to the metering database:

(A) for sixteen months in accessible format; and

(B) for seven years in archive; and

(19) VENCorp must establish a registration process to facilitate the application of this clause 4.4 to Participants in respect of:


(B) modifications to existing metering installations; and

(C) decommissioning of metering installations.MSO Rules Amendments to facilitate Full Retail Contestability:


Implementation of these amendments to the MSO Rules will take place as required to facilitate the implementation of full retail contestability, at a date yet to be advised.

4.4.1(e)(19) to be altered as follows:

(19) VENCorp must establish a registration process to facilitate the application of this clause 4.4 to Participants in respect of:


(B) modifications to existing metering installations; and

(C) decommissioning of metering installations.

required by VENCorp for the operation of the transmission system or for settlement.

4.4.2 Obligations of Market Participants to establish metering installations(a) Before a Market Participant will be permitted by VENCorp to inject or withdraw gas at a

connection point on the transmission system:

(1) that connection point must have a metering installation;

(2) that metering installation must have been installed in accordance with this clause 4.4 and be accurate in accordance with clause 4.4.8; and

(3) that metering installation must be registered with VENCorp.

(b) VENCorp may refuse to permit a Market Participant to inject or withdraw gas at a connection point on the transmission system if the metering installation at that connection point does not comply with the provisions or requirements of this clause 4.4.

(c) Before a Market Participant can inject gas at a connection point on a distribution pipeline, or withdraw or supply gas for withdrawal at a distribution delivery point from which the Customer purchases gas from a Retailer other than the Customer’s Local Retailer, the Market Participant must in respect of that connection point or distribution delivery point:(1) ensure that there is a metering installation at that connection point or distribution

delivery point;(2) ensure that metering installation is installed in accordance with this clause 4.4 and

is accurate in accordance with clause 4.4.8; and

(3) register that metering installation with VENCorp.MSO Rules Amendments to facilitate Full Retail Contestability:






(c) Before a Market Participant can inject gas at a connection point on a distribution pipeline, or withdraw or supply gas for withdrawal at a distribution delivery point from which the a tariff D Customer purchases gas from a Retailer other than the Customer’s Local Host Retailer, the Market Participant must in respect of that connection point or distribution delivery point:

(1) ensure that there is a metering installation at that connection point or distribution delivery point;

(2) ensure that metering installation is installed in accordance with this clause 4.4 and is accurate in accordance with clause 4.4.8; and

(3) register that metering installation with VENCorp.

(d) VENCorp may refuse to permit a Market Participant to inject gas into a connection point on a distribution pipeline, or withdraw or supply gas for withdrawal at a distribution delivery point where the Customer purchases that gas from a Retailer other than its Local Retailer if the metering installation at that connection point or delivery point does not comply with the provisions of this clause 4.4.





(d) VENCorp may refuse to permit a Market Participant to inject gas into a connection point on a distribution pipeline, or withdraw or supply gas for withdrawal at a distribution delivery point where the Customer purchases that gas from a Retailer other than its Local Host Retailer if the metering installation at that connection point or delivery point does not comply with the provisions of this clause 4.4.

(e) Subject to any agreement to the contrary, VENCorp may refuse to permit a Market Participant to participate in the market if that Market Participant does not have in force an agreement with a responsible person whereby that Market Participant contributes to its proportionate share of the costs incurred by that responsible person in measuring and testing gas at all metering installations for which the responsible person is responsible and at which the Market Participant has gas injected.

(f) In clause 4.4.2(e), and subject to any agreement to the contrary:

(1) “proportionate share” means a share calculated having regard to the actual quantity of gas injected at the metering installation by that Market Participant against the total quantity of gas injected at that metering installation in any particular billing period; and

(2) “costs” means the total costs incurred by the responsible person in operating and maintaining the metering installation and gas quality monitoring system,



and for the avoidance of doubt, VENCorp may provide to a responsible person for use in calculating the proportionate share of costs pursuant to clause 4.4.2(e), any statement submitted to it by an Allocation Agent pursuant to clause 3.5.2.

4.4.3 Responsibility for metering installation(a) The person who is responsible for providing a metering installation is the responsible

person.

(b) Subject to clause 4.4.3(d), the responsible person for a metering installation at:

(1) a receipt point on the transmission system is the Transmission Pipeline Owner associated with that receipt point, unless otherwise agreed between that Transmission Pipeline Owner and the Producer or the Storage Provider associated with that receipt point, as the case may be;

(2) a transfer point between one transmission pipeline and another transmission pipeline is the Transmission Pipeline Owner who owns the components that comprise the metering installation, unless otherwise agreed between the Transmission Pipeline Owners and/or Interconnected Pipeline Owners associated with that transfer point;

(3) a transfer point between the transmission system and a distribution pipeline is the Transmission Pipeline Owner associated with that transfer point unless otherwise agreed between that Transmission Pipeline Owner and the Distributor associated with that transfer point;

(4) a transmission delivery point at which a Transmission Customer is connected is the Transmission Pipeline Owner associated with that transmission delivery point, unless otherwise agreed between that Transmission Pipeline Owner and that Transmission Customer;

(5) a distribution delivery point at which a Market Customer or a Customer who is buying gas from a Retailer other than the Customer’s Local Retailer is connected is the Distributor associated with that distribution delivery point, unless otherwise agreed by that Distributor and the relevant Market Participant; and




4.4.3(b)(5) to be altered as follows:

(5) a distribution delivery point at which a Market Customer or a Customer who is buying gas from a Retailer other than the Customer’s Local Host Retailer is connected is the Distributor associated with that distribution delivery point, unless otherwise agreed by that Distributor and the relevant Market Participant; and

(6) a receipt point on a distribution pipeline is the Distributor associated with that receipt point, unless otherwise agreed between the Distributor and the Producer or the Storage Provider associated with that receipt point as the case may be.

(7) a connection point between distribution pipelines of different Distributors is the Distributor associated with the distribution pipeline that the gas flows principally from unless otherwise agreed between the relevant Distributors.



(c) The agreement of the relevant Participants under this clause must not be unreasonably withheld.

(d) A person who is not a Participant may only be the responsible person for a metering installation if it agrees with VENCorp to be bound by this clause 4.4 and such other provisions of these Rules as VENCorp may require on such terms as VENCorp may reasonably require.

(e) Where agreement is reached under clause 4.4.3(b), the person who would otherwise be the responsible person must immediately advise VENCorp of that agreement.

(f) The reasonable costs of the responsible person in meeting the requirements of this clause 4.4 must be borne by the affected Participant.

4.4.4 Other responsibilities of a responsible personThe responsible person must:

(a) ensure that its metering installations are provided, installed and maintained in accordance with this clause 4.4 and all applicable laws;

(b) ensure that the accuracy of each of its metering installations complies with the requirements of clause 4.4.8;

(c) ensure that each of its metering installations is calibrated in accordance with clause 4.4.9;

(d) if VENCorp requires, arrange for the provision of remote monitoring facilities to alert VENCorp or the responsible person of any failure of any components of the metering installation which might affect the accuracy of the metering data derived from that metering installation and, in the case of a facility which alerts the responsible person rather than VENCorp, the responsible person must notify VENCorp as soon as possible after the responsible person becomes aware of such failure; and

(e) provide to VENCorp the information specified in schedule 4.2 for each of its metering installations.

4.4.5 Additional meteringAny affected Participant may at its own cost provide additional meters or similar equipment at or near a connection point on the transmission system or a distribution delivery point in addition to the metering installation provided by the responsible person at that connection point or distribution delivery point for the purposes of checking the metering data obtained from that metering installation or for any other purposes, provided that such equipment:

(a) does not cause any Participant to breach any of the requirements of these Rules;

(b) complies with all applicable laws; and

(c) does not interfere with that metering installation or affect in any way the integrity or accuracy of the metering data provided by the metering installation.

4.4.6 Metering installation componentsA metering installation must:

(a) be accurate in accordance with clause 4.4.8;

(b) have facilities to enable metering data to be transmitted or otherwise collected from the metering installation and delivered to the metering database, and be capable of communication with the metering database, as required and in accordance with clause 4.4.18;

(c) contain a device which has a visible or an equivalently accessible display of metering data or which allows the metering data to be accessed and read at the same time by portable computer or other equipment of a type or specification reasonably acceptable to all



persons who are entitled to have access to that metering data in accordance with clause 4.4.22(a);

(d) be secure in accordance with clause 4.4.10;

(e) have electronic data recording facilities such that all metering data can be measured and recorded in hourly intervals with a date and time stamp being applied for each hourly interval;

(f) be capable of separately registering and recording flows in each direction where bi-directional gas flows occur; and

(g) have a meter having an internal or external data logger capable of storing the metering data for at least :

(1) 35 days, if the metering installation enables VENCorp to obtain remote access in accordance with clause 4.4.18; or

(2) 70 days, if the metering installation does not enable remote access by VENCorp in accordance with clause 4.4.18.

4.4.7 Location of metering pointThe responsible person must ensure that the metering installation is located as close as practicable to the connection point or distribution delivery point in relation to which the metering installation is being provided (taking into account, amongst other things, the cost of installation and security).

4.4.8 Meter accuracy(a) A metering installation at a transmission delivery point must satisfy the uncertainty limits in

schedule 4.1 over its entire range of flow rates.

(b) A metering installation at a distribution delivery point must satisfy the uncertainty limits set out in the Distribution System Code over its entire range of flow rates.

4.4.9 Calibration of metering installations(a) This clause 4.4.9 applies only to metering installations at system points.(b) The responsible person must procure that its metering installations are calibrated in

accordance with the requirements contained in schedule 4.1.

(c) VENCorp must review the calibration requirements contained in schedule 4.1 within one year after the commencement date and at intervals not exceeding one year thereafter and may, following consultation with Market Participants, change such requirements. VENCorp must publish details of any such change and the date upon which the change will take effect.

(d) The responsible person must establish calibration procedures in respect of each of its metering installations. The calibration procedures must comply with any requirements which VENCorp may from time to time determine.

(e) VENCorp may check calibration results recorded in respect of any metering installation and arrange for testing of metering installations in order to satisfy itself that the accuracy of each metering installation conforms with the requirements of this clause 4.4 or to determine the consistency between the data held in the metering database and metering data held in a metering installation.

(f) The responsible person must make available the results of all tests in respect of its metering installations to VENCorp and all affected Participants as soon as practicable after they have been completed.



(g) If there is an inconsistency between the data held in a metering installation and the data held in the metering database, the data in the metering installation is to be taken as prima facie evidence of the energy data derived from that metering installation.

(h) The responsible person must permit VENCorp and any affected Participant to have a representative present to observe the calibration of its metering installations and any consequential adjustments.

(i) The responsible person must give VENCorp and all affected Participants at least fourteen days written notice, or such shorter notice as may be agreed by VENCorp and all affected Participants, of the proposed hours and date or dates on which a metering installation is to be calibrated and the nature of the calibration to be undertaken.

(j) Each affected Participant who wishes to have a representative present to observe a calibration of a metering installation must give written notice to the responsible person of its intention to have a representative present not less than seven days prior to the date on which that calibration is to be undertaken as specified in the notice referred to in clause 4.4.9(i). The responsible person and all affected Participants who wish to have a representative present must use all reasonable endeavours to agree upon the time and date at which the calibration will take place and, in the absence of agreement, the calibration will take place at the time specified in the notice given by the responsible person pursuant to clause 4.4.9(i).

(k) If VENCorp or an affected Participant does not exercise its right under clause 4.4.9(h) to have a representative present, the results of the calibration will be binding on VENCorp and that affected Participant.

(l) VENCorp and each affected Participant may, at all reasonable times, by giving reasonable prior notice to the responsible person:

(1) inspect the responsible person’s metering installation and records in respect of a metering installation; and

(2) require that the responsible person conduct a calibration of any metering equipment which VENCorp or the affected Participant reasonably believes is inaccurate.

(m) The cost of any calibration which the responsible person is required to conduct pursuant to clauses 4.4.9(e) or 4.4.9(l) must be borne by the person requiring the calibration if the metering equipment is found to be accurate within the applicable accuracy parameters described in schedule 4.1 and by the responsible person if found to be outside any of those accuracy parameters.

(n) The responsible person must monitor its metering installations on a regular basis in order to ensure that they are operating properly in accordance with this clause 4.4.

(o) If the responsible person becomes aware that the accuracy of a metering installation does not comply with the requirements of this clause 4.4 or of any matter which could affect the integrity of the metering data, the responsible person must:

(1) notify all affected Participants and VENCorp as soon as practicable after it becomes aware of the matter; and

(2) arrange for the accuracy of the metering installation to be restored or for the metering installation to be modified or replaced by such time as VENCorp may reasonably determine so that the metering installation meets the requirements of this clause 4.4.

(p) The responsible person must within two business days after it becomes aware of any matter described in clause 4.4.9(o) provide a report to VENCorp in relation to that matter



and, where requested by VENCorp, prepare an estimate of the actual quantity of gas transferred through the affected metering installation.

(q) The responsible person must notify all affected Participants and VENCorp if practicable at least seven days prior to, and in any event seven days after, any modification, adjustment, repair or replacement of any of its metering installations where such action may have an impact on metering accuracy or integrity and such notice must, if applicable, include a record of the readings of the relevant metering installation at all relevant times.

4.4.10 Security of metering equipment(a) The responsible person must use reasonable endeavours to protect the metering

installation from unauthorised interference both intentional and inadvertent by providing secure housing for metering equipment or otherwise ensuring that security at the metering point is adequate to protect against such interference.

(b) If evidence of tampering with a metering installation is found by a Participant, all affected Participants must be notified of that fact by that Participant as soon as reasonably possible.

(c) If a Participant finds evidence that the accuracy of the metering of a metering installation might have been affected by any tampering, then the responsible person must test the metering installation to ensure that the metering equipment operates within the applicable accuracy parameters described in schedule 4.1.

(d) A Participant who interferes with a metering installation without the approval of the responsible person must pay the responsible person its reasonable costs of adjustment, repair, replacement and testing of the metering installation.

4.4.11 Security of metering data held in a metering installation(a) The responsible person must ensure that metering data held in a metering installation is

protected from local or remote electronic access by suitable security electronic access controls (including, if required by VENCorp, passwords).

(b) The responsible person must keep secure records of electronic access passwords.

(c) If required by VENCorp, the responsible person must allocate ‘read-only’ passwords for each metering installation to affected Participants and VENCorp, except where separate ‘read-only’ and ‘write’ passwords are not available, in which case the responsible person must allocate a password to VENCorp only.

(d) The responsible person must hold ‘read-only’ and ‘write’ passwords.

4.4.12 Changes to metering parameters and settingsChanges to parameters or settings within a metering installation which may affect the accuracy of metering data must be:

(a) notified to VENCorp by the responsible person at least two business days before the change (other than a change made as a result of a calibration carried out pursuant to this clause 4.4) is made;

(b) confirmed to VENCorp by the responsible person within two business days after the change has been made; and

(c) recorded by VENCorp in the metering register.4.4.13 Energy metering and measurement

(a) The responsible person must ensure that the metering installation is capable of determining quantities of gas and where relevant the energy content of volumes of gas flowing through the relevant metering point in accordance with this clause 4.4.13.



(b) A metering installation at a connection point on the transmission system must be capable of determining the energy content of quantities of gas flowing through the metering point unless otherwise agreed by VENCorp and the responsible person.

(c) A metering installation at a distribution delivery point must be capable of measuring the volume of gas flowing through the metering point unless VENCorp reasonably requires that metering installation also to be capable of determining the energy content of quantities of gas flowing through the metering point.

(d) For avoidance of doubt, where a metering installation measures only the volume of gas flowing through the metering point, the determination of the energy content of the quantities of gas flowing will be done within the metering database.

(e) The energy content of quantities of gas flowing through a metering point at each metering installation whether calculated within the metering installation or within the metering database must be calculated in accordance with American Gas Association Report no. 7 (measurement of gas by turbine meters), American Gas Association Report no. 8 (compressibility factors of natural gas and other related hydro-carbon gas) and ISO6976 (calculation of calorific value, density, relative density and wobbe index from gas composition) unless the responsible person, the affected Participants and VENCorp agree otherwise.

(f) Where the energy content of quantities of gas flowing through a metering point is calculated within a metering installation it must be calculated using heating value and gas composition data collected from the metering installation or, if the data is not available from the metering installation, using data transmitted to the metering installation from the metering database.

(g) The source of data used for determining the energy content of gas flowing through a metering point at a metering installation (including heating value, gas composition and relative density) must be determined by VENCorp, after consultation with the responsible person.

(h) In determining the appropriate source of data which VENCorp must make available to the responsible person to enable the responsible person to calculate the energy content of quantities of gas in accordance with this clause 4.4.13, VENCorp must have regard to the proximity of the source of the data to the relevant metering installation.

(i) In determining the heating values to be applied to the calculation of the energy content of quantities of gas, VENCorp must use reasonable endeavours to ensure that the uncertainty limits specified in schedule 4.1 are satisfied.

(j) Unless VENCorp and the responsible person agree otherwise, data made available by VENCorp to the responsible person for the purpose of calculating the energy content of quantities of gas flowing through a metering point must be averaged for one hour and applied by the responsible person for the purpose of measuring the energy content of quantities of gas flowing through the metering point in the next hour.

(k) Each metering installation must be capable of recording metering data in hourly intervals.

4.4.14 Performance of metering installations(a) The responsible person must use all reasonable endeavours to procure that metering data

is able to be transmitted or otherwise collected and delivered to the metering database from its metering installations:

(1) within the applicable accuracy parameters described in schedule 4.1 for metering installations at transmission delivery points, and in the Distribution System Code for metering installations at distribution delivery points;



(2) within the time required for settlement, at a level of availability of at least 99% per annum in the case of metering installations (excluding the communication link);

(3) within the time required for settlement, at a level of availability of at least 95% per annum in the case of the communication link; and

(4) in accordance with the requirements of clause 4.4.18,

or as otherwise agreed between VENCorp and the responsible person.

(b) If a metering installation malfunction or defect occurs, the responsible person must procure that repairs must be made to the metering installation as soon as practicable and in any event within two days, unless VENCorp otherwise agrees.

(c) A Participant who becomes aware of a metering installation malfunction or other defect must advise VENCorp as soon as practicable.



4.4.15 Meter Time(a) The responsible person must ensure that all metering installation and data logger clocks

are referenced to Eastern Standard Time.

(b) The metering database must be set within an accuracy of plus or minus two seconds of Eastern Standard Time for a system point other than a transmission delivery point and within an accuracy of plus or minus five seconds of Eastern Standard Time for a transmission delivery point and a distribution delivery point.

4.4.16 Pulse output facilities(a) Within a reasonable time of being requested by an affected Participant or VENCorp, the

responsible person must provide pulse outputs representing the quantities of gas measured for use by the affected Participant in controlling its production or consumption of gas or by VENCorp for any system operation purpose.

(b) The person requesting the pulse output under clause 4.4.16(a) must pay the responsible person’s reasonable costs relating to the provision of the pulse output.

4.4.17 Changes to metering dataThe responsible person must not make, and must use reasonable endeavours to ensure that no other person makes, any alteration to the original stored data in a metering installation.

4.4.18 Data transfer and collection(a) VENCorp must collect metering data from all metering installations from which metering

data is required for settlement purposes unless otherwise agreed by VENCorp and the affected Participants.

(b) Each Participant must use its reasonable endeavours to ensure that VENCorp is given access to, or is provided with, the metering data referred to in clause 4.4.18(a).

(c) The responsible person must, at its own cost, ensure that metering data derived from a metering installation for which it is responsible shows the time and date at which it is recorded and is capable of being transmitted or otherwise collected from the metering installation and delivered to the metering database in accordance with VENCorp’s reasonable requirements and in accordance with VENCorp’s metering communications procedures.

(d) Without prejudice to the generality of clause 4.4.18(c), for all delivery points at which Customers withdraw 100,000GJ of gas per annum or more, and all distribution delivery points identified prior to 1 September 2000 at which Customers withdraw more than 10,000GJ per annum and for which metering data is required for the purposes of the allocation algorithm developed in accordance with clause 3.5.4, the responsible person must ensure that each of its metering installations contains a telephone line or radio transmitter and/or such other equipment as VENCorp may reasonably require to enable metering data to be transmitted to, and to enable VENCorp to obtain remote access to the metering data from, the metering database.




4.4.18(d) to be replaced by the following:

(d) Without prejudice to the generality of clause 4.4.18(c), the responsible person must ensure that each of its metering installations contains such communication equipment as VENCorp may reasonably require



to:

(1) enable metering data to be transmitted to the metering database; and

(2) enable VENCorp to obtain remote access to the metering data from the metering database,

for the purpose of VENCorp’s operation of the transmission system, for determination of settlement and/or for maintaining metering integrity.

(e) The transfer of metering data from the metering installation of the metering database shall occur hourly unless otherwise agreed by VENCorp and the affected Participants.

4.4.19 Installation databases(a) The responsible person must create, maintain and administer an installation database in

relation to all its metering installations.

(b) The responsible person must ensure that each affected Participant and VENCorp is given access to the information specified in clause 4.4.19(c) in its installation database at all reasonable times and:

(1) in the case of data sixteen months old or less, within two business days of receiving written notice from the person seeking access; and

(2) in the case of data more than sixteen months old, within thirty days of receiving written notice from the person seeking access.

(c) The responsible person must ensure that its installation database contains the information specified in schedule 4.3.

(d) The responsible person must ensure that the information specified in clause 4.4.19(c) is stored in its installation database:

(1) in accessible format for sixteen months; and

(2) in archive, for seven years or for the life of the relevant meter, whichever is longer.

4.4.20 Metering database(a) VENCorp must create, maintain and administer a metering database containing

information for each metering installation registered with VENCorp.(b) VENCorp may appoint an agent from time to time to create, maintain and administer the

metering database.

(c) VENCorp must use its reasonable endeavours to procure that the metering database is accessible by all affected Participants at all reasonable times and:

(1) in the case of data sixteen months old or less, within four hours of receiving a written request from an affected Participant; and

(2) in the case of data more than sixteen months old, within two business days of receiving a written request from an affected Participant.

(d) The metering database must include metering data, energy data, energy calculations, gas quality data, data substituted in accordance with this clause 4.4 and all calculations made for settlement purposes.







(d) The metering database must include metering data, energy data, energy calculations, gas quality data, data substituted in accordance with this clause 4.4 or data provided to VENCorp for settlement purposes in accordance with the Retail Gas Market Rules and all calculations made for settlement purposes.

(e) Data must be stored in the metering database:

(1) for 16 months in accessible format; and

(2) for 7 years in archive.

(f) Rights of access to data held in the metering database are set out in clause 4.4.22.

4.4.21 Register of metering information(a) As part of the metering database, VENCorp must maintain a metering register of all

metering installations which provide metering data used by VENCorp for settlement purposes.

(b) The metering register referred to in clause 4.4.21(a) must contain the information specified in schedule 4.2.

(c) If the information in the metering register indicates that a metering installation does not comply with the requirements of this clause 4.4:

(1) VENCorp must advise all affected Participants and the responsible person of that fact; and

(2) the responsible person must procure that the metering installation complies with the requirements of this clause 4.4 within two business days after the date of the notice unless otherwise agreed by VENCorp.

(ca) Prior to the date on which the group of Customers who withdraw more than 500,000GJ per year from a connection point become Non-Franchise Customers to whom any Retailer is authorised to sell gas under its retail licence, VENCorp must, in consultation with Participants, develop and publish transfer procedures for Non-Franchise Customers transferring from one Retailer to another Retailer.




4.4.21(ca) to be deleted without replacement

(d) Prior to the group of customers referred to in section 6B(1)(d) of the Gas Industry (Residual Provisions) Act 1994 ceasing to be Franchise Customers, VENCorp must, in accordance with the public consultation procedures, establish, administer, and review transfer procedures to deal with registration procedures for transfer between Retailers of customers who are not Franchise Customers.



Implementation of these amendments to the MSO Rules will take place as required to facilitate the implementation of full



retail contestability, at a date to be advised.

4.4.21(d) to be deleted without replacement

(e) VENCorp is not obliged to accept registration data in relation to a customer who is not a Franchise Customer transferring between Retailers if such registration data is not provided in accordance with the transfer procedures referred to in clause 4.4.21(d).




4.4.21(e) to be deleted without replacement

4.4.22 Rights of access to metering data(a) The only persons entitled to have either direct or remote access to metering data from a

metering installation, the metering database or the metering register in relation to a metering point are:

(1) each Market Participant whose settlement amounts are determined by reference to quantities of gas flowing through that metering point;

(2) the responsible person who is responsible for the metering installation at that metering point;

(3) a Transmission Pipeline Owner or Interconnected Pipeline Owner whose pipeline is connected to the metering installation at that metering point;

(4) the Distributor whose pipeline is connected to the metering installations at that metering point;

(5) VENCorp and its authorised agents; and

(6) the Allocation Agent appointed in respect of a system injection point or a system withdrawal point to which that metering point relates.

(b) Notwithstanding clause 4.4.22(a), a Transmission Customer is entitled to have either direct or remote access to metering data from a metering installation at a transmission delivery point for that Transmission Customer.

(c) Provided that the relevant Customer has consented, a Retailer is entitled to have access to historical data relating to a Customer who has transferred to that Retailer from another Retailer in relation to the period prior to the date on which that Customer transferred to that Retailer.

(d) Electronic access to metering data from a metering installation shall only be provided where passwords are allocated in accordance with clause 4.4.11 otherwise access to metering data shall be from the metering database.

(e) The responsible person must ensure that access to metering data from the metering installation by persons referred to in clause 4.4.22(a) is scheduled appropriately to ensure that congestion does not occur.



(f) The responsible person must ensure that all persons referred to in clause 4.4.22(a) have access to the metering data provided by its metering installations at all reasonable times and on reasonable notice.

(g) If remote access is required under clause 4.4.18(d) and is unavailable for a period of five consecutive business days, the responsible person must, if requested by any person referred to under clause 4.4.22(a), at its own cost, obtain readings locally from the metering installation and provide those readings to all persons with rights of access under clause 4.4.22(a).

4.4.23 Payment for access to metering dataAll reasonable costs (including, without limitation, telecommunications charges) incurred by the responsible person in providing access to metering data at a metering installation or by VENCorp in providing access to information in the metering database must be paid by the Participant to whom the metering data or information was provided.

4.4.24 Data validation and substitution(a) VENCorp is responsible for the validation and substitution of metering data.

(b) VENCorp must develop data validation processes in consultation with Participants.MSO Rules Amendments to facilitate Full Retail Contestability:




(b) VENCorp must develop data validation processes for metering data in consultation with Participants.

(c) If VENCorp detects a loss of metering data or incorrect metering data from a metering installation, it must notify all affected Participants of the fact and of details of the loss or error detected as soon as reasonably practicable and in any event at the time the next settlement statement is issued in respect of that metering point.

(d) If:

(1) any metering equipment at a metering installation is removed from service; or

(2) any metering data is found to be inaccurate or incorrect; or

(3) calibration of any meter at a metering installation reveals a measurement error which exceeds the metering substitution threshold applicable to that meter; or

(4) calibration of any meter at a metering installation reveals a measurement error which is less than the metering substitution threshold applicable to that meter and, in VENCorp’s reasonable opinion, a Participant would be materially and adversely affected if no substitution was made pursuant to this clause; or

(5) metering data is not transmitted or otherwise collected from a metering installation and delivered to the metering database within the time required for settlement,

VENCorp must adopt substitute readings in accordance with this clause 4.4.24.

(e) If substituted readings are required pursuant to clauses 4.4.24(d)(3) or (4) and VENCorp is not aware of the time at which the error arose, then the substitution must be made for the period which is the shorter of:



(1) the period from the time half-way between the time of the most recent calibration which demonstrated that the meter complied with the requirements of this clause 4.4 and the time when the error was corrected; and

(2) the period commencing on the date six months prior to the date on which the error was corrected; and

(3) such other period expiring on the date on which the error was corrected, being a period of less than six months, which VENCorp considers to be fair and reasonable.

(f) If VENCorp is required to make substituted readings pursuant to clause 4.4.24(d), VENCorp must:

(1) determine the period of substitution (in accordance with clause 4.4.24(e) if applicable);

(2) calculate the substituted readings in accordance with clause 4.4.24(h);

(3) replace all readings derived from the relevant metering equipment during such period of substitution with such substituted readings; and

(4) notify all affected Participants as soon as reasonably practicable after the substitution has been completed.

(g) If an affected Participant disputes a substitution made by VENCorp pursuant to this clause 4.4.24, the following provisions apply:

(1) the affected Participant must give notice of the dispute and the matters dispute to VENCorp;

(2) as soon as reasonably practicable after receiving a notice pursuant to paragraph (1), VENCorp must give notice of the dispute and the matters disputed to each affected Participant;

(3) the affected Participants must use their reasonable endeavours to resolve the dispute and agree the substituted readings; and

(4) if the dispute has not been resolved by the affected Participants on or before the second business day prior to the next date on which VENCorp is required to issue final statements, VENCorp must use the substituted readings determined by it pursuant to clause 4.4.24(i) and the dispute must be referred to the Adviser for resolution in accordance with clause 7.2.

(h) If substituted readings are required pursuant to this clause 4.4.24, they must be determined in the following order of priority:

(1) if and to the extent that the responsible person is able to provide actual readings from the relevant meter for the period of substitution by manually reading the meter, those readings must be used for the purposes of determining the substituted readings;

(2) if and to the extent that meter readings are available from another meter provided for the purposes of checking metering data pursuant to clause 4.4.5 and that meter complies with the accuracy requirements for the related metering installation, those readings must be used for the purposes of determining the substituted readings; and



(3) if and to the extent that meter readings are not available in accordance with clauses 4.4.24(h)(1) and (2), VENCorp may use any or all of the following methods for providing data for the purposes of determining the substituted readings:

(A) VENCorp may use readings available from any other meter which may reflect the flow of gas through the relevant metering point, whether or not such meter complies with the requirements of this clause 4.4;

(B) VENCorp may use trend data recorded by VENCorp, the responsible person or any other affected Participant where, in VENCorp’s reasonable opinion, such data gives a good approximation of the actual measurement;

(C) VENCorp may correct the reading which is required to be substituted if the deviation from the accurate reading is ascertainable by calibration or mathematical calculation;

(D) VENCorp may estimate readings based upon readings from the same meter under similar conditions during a period when the meter was registering accurate readings; or

(E) VENCorp may use such other method as VENCorp may consider fair and reasonable in the circumstances.

4.4.25 ConfidentialityMetering data and passwords are confidential and each Participant must ensure that they are treated as confidential information in accordance with these Rules.




4.4.25 is to be altered as follows:

Metering data and data provided to VENCorp for settlement purposes in accordance with the Retail Gas Market Rules and passwords are confidential and each Participant must ensure that they are treated as confidential information in accordance with these Rules.

4.4.26 Use of meters(a) Metering data must be used by VENCorp as the primary source of data for settlement

purposes.MSO Rules Amendments to facilitate Full Retail Contestability:




(a) Metering data must be used by VENCorp as the primary source of data for settlement purposes or data provided to VENCorp for settlement purposes in accordance with the Retail Gas Market Rules.



(b) Notwithstanding any other provision of this clause 4.4, VENCorp shall not be liable to any person in respect of any inaccuracies, discrepancies or other defects in metering data, including metering data which is stored in the metering database.





(b) Notwithstanding any other provision of this clause 4.4, VENCorp shall not be liable to any person in respect of any inaccuracies, discrepancies or other defects in metering data and data provided to VENCorp for settlement purposes in accordance with the Retail Gas Market Rules, including metering data which is stored in the metering database.

(c) Where a metering installation is used for purposes in addition to the provision of metering data to VENCorp then:

(1) that use must not be inconsistent with, or cause any Participant to breach, any requirements of these Rules or any applicable laws; and

(2) the responsible person must coordinate with the persons who use the metering installation for such other purposes to ensure that clause 4.4.26(c)(1) is complied with.

4.4.27 Evolving technologies and processes and development of the market(a) Evolving technologies or processes that:

(1) meet or improve the performance and functional requirements of this clause 4.4; or

(2) facilitate the development of the market,may be used in relation to a metering installation if agreed between the affected Participants and VENCorp (such agreement not to be unreasonably withheld).

(b) Prior to the group of customers referred to in section 6B(1)(c) of the Gas Industry (Residual Provisions) Act 1994 ceasing to be Franchise Customers, VENCorp must review the requirement for metering installations to be installed at distribution delivery points from which gas is withdrawn by any Customer who purchases its gas from a Retailer other than the Local Retailer.




4.4.27(b) to be deleted without replacement.

4.4.28 Review of the metering provisionsNo later than two years after the commencement date and at intervals not exceeding two years thereafter, VENCorp must undertake a review of the provisions of clause 4.4 in accordance with the public consultation procedures, including but not limited to:



(a) new technologies and the impact of new technologies on and in relation to technical standards for metering in these Rules;

(b) contestability in the type of meters used; and

(c) whether the provisions of clause 4.4 have the effect of eliminating the use of alternative types of meters.



SCHEDULE 4.1 METERING UNCERTAINTY LIMITS AND CALIBRATION REQUIREMENTS

1. Uncertainty limits for measuring volumeThe table below sets out the uncertainty limits required to be met by the responsible person for metering installations for transfer points on the transmission system.

Category Flow rate range(scmh) Uncertainty limits (volume)

A >300,000 ±0.7%

B >40,000£300,000

±1.0%

C >4,000£40,000

±1.5%

D £4,000 ±2.5%

2. Calibration requirementsThe table below sets out the frequency with which the calibration must be carried out by the responsible person.

Category A B C DPeak flow rate (scmh) >300,000 >40,000

£300,000>4,000£40,000

£4,000

Minimum pressure and temperature transmitter calibration frequency

Quarterly Six-monthly Annually Annually or as otherwise agreed with VENCorp

Remote meter fault detection surveillance frequency

Daily by exception

Daily by exception

Daily by exception

Daily by exception

In situ meter proving frequency AnnuallyNote: for ultrasonic meters by electronic

means

AnnuallyNote: for ultrasonic meters by electronic

means

Annually or as otherwise

agreed with VENCorp. Note: for ultrasonic meters by electronic

means

Annually or as otherwise

agreed with VENCorp



3. Uncertainty limits for energy calculationsThe table below sets out the uncertainty limits required to be achieved in calculating energy values at transfer points on the transmission system. These limits have been developed to be applicable to a market based on a daily trading interval. Should the market adopt a different trading interval, these limits will need to be reviewed.

Category Flow rate range(scmh) Uncertainty limits(energy)

A >300,000 ±1.0%

B >40,000£300,000

±1.5%

C >4,000£40,000

±2.0%

D £4,000 ±3.0%



SCHEDULE 4.2 METERING REGISTER

1. General(a) The metering register forms part of the metering database and holds metering information relating

to metering installations.

(b) The purpose of the metering register is to facilitate:

(1) the registration of system points, distribution delivery points, metering points and affected Participants;

(2) the verification of compliance with these Rules; and

(3) the audit flow of changes to the registered information.

2. Metering register informationMetering information to be contained in the metering register should include such information as VENCorp considers reasonably necessary and by way of example, may include the following:

(a) Meter identification:

(1) metering installation reference number (MIRN);

(2) logical meter identification - if a logical meter; and

(3) logical meter algorithm - if a logical meter.

(b) Location in market:(1) CTM group identification;

(2) heating value zone;

(3) UAFG zone;

(4) pricing zone;

(5) system withdrawal zone;

(6) injection point;

(7) TUoS zone;

(8) hub identification;

(9) hub flow direction; and

(10) transmission or distribution connection point identification.MSO Rules Amendments to facilitate Full Retail Contestability:



New sub-clauses to be added to Schedule 4.2(b) as follows:

(9) hub flow direction; and

(10) transmission or distribution connection point identification;

(11) base load; and

(12) temperature sensitivity factor.



(c) Associated parties:

(1) metering data agency identification;

(2) responsible person identification;

(3) Market Participant settling account identification;

(4) host Retailer identification;

(5) supplying Retailer identification;

(6) relevant Distributor identification and

(7) Allocation Agent identification.MSO Rules Amendments to facilitate Full Retail Contestability:



New sub-clauses to be added to Schedule 4.2(c) as follows:

(6) relevant Distributor identification; and

(7) Allocation Agent identification; and

(8) supplier of last resort identification.

(d) Data validation and substitution processes agreed between affected Participants, including:

(1) algorithms;

(2) data comparison techniques

(3) processing and alarms; and

(4) alternate data sources.

(e) Meter information:

(1) Meter type

(2) Meter size

(3) Meter maximum capacity



SCHEDULE 4.3 INSTALLATION DATABASE

Each installation database must contain the following installation information and such other installation information as specified by VENCorp:(a) Metering point reference details, including:

(1) locations and reference details (eg drawing numbers);

(2) site identification names;

(3) details of affected Participants associated with the system point; and

(4) the responsible person.MSO Rules Amendments to facilitate Full Retail Contestability:



New sub-clauses to be added to Schedule 4.3(a) as follows:

(3) details of affected Participants associated with the system point; and

(4) the responsible person;

(5) meter installation registration number (MIRN);

(6) base load;

(7) temperature sensitivity factor; and

(8) Customer characterisation.

(b) The identity and characteristics of metering equipment including:

(1) serial numbers;

(2) metering installation identification name;

(3) metering installation types and models;

(4) current test and calibration programme details, test results and references to test certificates;

(5) calibration tables, where applied to achieve metering installation accuracy; and

(6) data register coding details.

(c) Data communication details, including:

(1) telephone number(s) (or frequency details in the case of telemetric equipment) for access to data;

(2) communication equipment type and serial numbers;

(3) communication protocol details or references;

(4) data conversion details;

(5) user identifications and access rights; and

(6) “write” password (to be contained in a hidden or protected field).



CHAPTER 5. MARKET INFORMATION AND SYSTEM PLANNING



5.1 MARKET INFORMATION

5.1.1 Provision of information(a) The provisions of this clause 5.1 are subject always to the rights and obligations of

VENCorp and Participants in relation to confidential information as set out in clause 5.4.

(b) In addition to any specific obligation or power of VENCorp under these Rules to provide information, VENCorp must make available to Market Participants on request any information concerning the operation of the market and may charge a fee reflecting the cost of providing any information under this clause 5.1.1(b).

(c) VENCorp must make available to the public on request information in respect of the market price and, where requested and available, reasons for any significant movements in the market price.

5.1.2 Systems and procedures(a) All information, including nominations and inc/dec offers where relevant, which must be

provided by Participants to VENCorp under these Rules and information which must be provided by VENCorp to Participants under these Rules must be provided by means of an electronic communication system unless otherwise specified in these Rules or approved by VENCorp.

(b) Where information is provided by means of an electronic communication system, that information must be provided by using the templates supplied in the electronic communication system unless otherwise approved by VENCorp.

(c) If possible, information provided to VENCorp must be time stamped by VENCorp on receipt by VENCorp’s electronic communication system and if stamped, is deemed to be provided at the time indicated by the time stamp.

(d) Information is deemed to be published by VENCorp when the information is placed on the market information bulletin board.

(e) Before the commencement date and following consultation with Participants, VENCorp must develop electronic communication procedures under which:

(1) information, including nominations and inc/dec offers where relevant, must be provided by Participants to VENCorp;

(2) information must be provided by VENCorp to Participants; and

(3) information published on the market information bulletin board may be accessed by Market Participants.

(f) Following consultation with Participants, VENCorp may review and alter:

(1) the requirements for electronic communication systems; and

(2) electronic communication procedures,

from time to time.

5.1.3 Participant dataVENCorp must establish, maintain, update as VENCorp considers reasonably necessary from time to time, and publish:

(a) a list of all Participants identifying those of them that are Market Participants;

(b) a list of all applications to become a Participant identifying those of them that are applications to become a Market Participant;



(c) a list of all Participants who will cease to be Participants and the time that each listed Participant will cease to be a Participant; and

(d) a list of all Market Participants who are suspended and the time at which each listed Market Participant was suspended.

5.1.4 Spot market(a) VENCorp must publish preliminary operating schedules and final operating schedules in

accordance with and at the times specified in clause 3.1.

(b) Each preliminary operating schedule and final operating schedule must include the following details for the relevant gas day in respect of the transmission system unless otherwise specified below:

(1) forecasts of the most probable peak daily demand and peak hourly demand and the times at which those peaks are forecast to occur;

(2) forecasts of peak hourly demand which VENCorp predicts to have a 10% and 90% probability respectively of being exceeded and the time at which those peaks are forecast to occur;

(3) forecasts of the aggregate total demand for each trading interval;(4) forecast aggregate supply availability for each trading interval;(5) details of forecast threats to system security, including the forecast time, location

and extent of each such threat;

(6) forecasts of the market price for each trading interval and each pricing zone; and

(7) details of the expected sensitivity of the forecast market prices to changes in the forecast demand or supply availability;

(8) forecast locational prices for each hour of the gas day;

(9) forecast EoD linepack; and

(10) the linepack which VENCorp requires in respect of that gas day.

(c) If VENCorp considers there to be a significant change in a forecast market price, VENCorp must identify and, as soon as practicable, publish the cause of such a change, including but not limited to the impact of any change.

(d) As soon as practicable after the end of each trading interval, VENCorp must publish its best estimate of the market price for that trading interval.

(e) By 4.00pm each day, VENCorp must publish for each trading interval in the previous gas day:

(1) the market price;

(2) the aggregate quantity of withdrawals of gas from each system withdrawal zone or such other area that VENCorp considers appropriate having regard to the commercial sensitivity of information relating to the demand and consumption patterns of Customers and the requirements of clause 5.2.4(f);

(3) without limitation, prices and quantities of gas specified in inc/dec offers;

(4) aggregate quantities of gas specified in nominations;

(5) details of the total quantity of gas injected into the transmission system at each system injection point;

(6) details of the total quantity of gas scheduled in accordance with withdrawal inc/dec offers in each system withdrawal zone or such other area that VENCorp considers



appropriate having regard to the commercial sensitivity of information relating to the demand and consumption patterns of Customers and the requirements of clause 5.2.4(f);

Sub-clause 5.1.4.(e)(7) deleted by notice published in the Government Gazette dated 28 February 2002

(8) details of any operational irregularities which arose including, for example, any circumstances in which, in VENCorp’s reasonable opinion, there was evidence of a failure to follow scheduling instructions.

5.1.5 Public information(a) Each day, all information relating to the operation of the market that VENCorp is required

to publish in accordance with these Rules must be made available by VENCorp via an electronic communications medium.

(b) If VENCorp makes information available under clause 5.1.5(a) by a means other than the internet, VENCorp may, at its discretion, charge a fee for access to that information provided that such fee reflects VENCorp’s costs of providing that information.

(c) VENCorp must make available for purchase by any person at reasonable cost the current annual planning review prepared pursuant to clause 5.2.2 from the date on which it is published.

5.1.6 Information recordsVENCorp must retain all information provided to it under these Rules for at least seven years in a form it deems appropriate for reasonable access.

5.1.7 Market audit (a) VENCorp must arrange for a Review to be conducted at least annually by a Market

Auditor.(aa) VENCorp shall appoint a Market Auditor who in VENCorp’s reasonable opinion is

independent and suitably qualified to conduct the required Review.

(b) The Review must examine compliance by VENCorp with its procedures and the effectiveness and appropriateness of systems utilised in the operation of the market, including but not limited to:

(1) the calculations and allocations performed by the metering and settlements systems;

(2) billing and information systems;

(3) the scheduling and pricing processes;

(4) processes for software management;

(5) the linepack account; and

(6) VENCorp’s compliance with these Rules.(ba) VENCorp must establish and implement a consultative process that enables Market

Participants to provide input into the development of the scope of the Review on an annual basis.

(c) VENCorp must ensure that the person who conducts the Review prepares a report in which the results of the Review are set out.



(d) The report prepared by the Market Auditor in accordance with clause 5.1.7(c) must be made available by VENCorp to Participants on request.



5.2 FORECASTS AND PLANNING AND MAINTENANCE REVIEWS

5.2.1 Purpose(a) Under this clause 5.2:

(1) Participants are required to provide information to VENCorp in relation to certain aspects of their operations in accordance with clauses 5.2.4(b), (c) and (d); and

(2) VENCorp is required to use the information disclosed to it by Participants to:

(A) prepare and provide to Participants annual planning reviews for the purposes set out in clauses 5.2.1(b) and (c); and

(B) coordinate the maintenance operations of Transmission Pipeline Owners and Storage Providers to ensure that system security is maintained and is not threatened by the maintenance of pipeline equipment.

(b) VENCorp is required to provide annual planning reviews under clause 5.2.2 for the purpose of allowing Participants to make informed decisions relating to:

(1) planning for capital investments;

(2) developing market strategies;

(3) maintenance;

(4) storage;

(5) pipeline operation; and

(6) pricing.

[Clause 5.2.1(c) deleted: By Notice published in the Government Gazette G7, dated 15 February 2001, effective from 21 February 2001]

(d) VENCorp must use its reasonable endeavours to ensure that the annual planning reviews it prepares under this clause 5.2 accurately reflect the information provided to VENCorp by Participants under clauses 5.2.4(b), (c) and (d), but in no circumstances is VENCorp to be liable for any loss or damage suffered or incurred by a Participant or any other person as a consequence of any error, omission or inaccuracy in an annual planning review.

5.2.2 Annual planning reviews(a) By no later than 30 November each year, VENCorp must:

(1) prepare an annual planning review in accordance with this clause 5.2.2; and

(2) provide to each Participant and the Regulator a copy of that annual planning review.

(b) Each annual planning review must contain annual forecasts by system withdrawal zone of the matters set out in clause 5.2.2(c) for each year of the five years and for each month of the twelve months in the period commencing from 1 January in the year immediately following the year in which the annual planning review is provided to Participants.



(c) Annual planning reviews prepared by VENCorp must include forecasts by system withdrawal zone in respect of the following matters:

(1) most probable peak daily and hourly demands under average demand conditions and when those peak demands will occur;

(2) most probable peak daily and hourly demands under peak demand conditions (or such other planning criteria as VENCorp may determine) and when those peak demands will occur;

(3) total demand;(4) available and prospective supply and the source of that supply;

(5) any expansions of, and extensions to, the transmission system;

(6) transmission system capacity;

(7) the acceptable range of minimum and maximum pressures at such transmission system locations as VENCorp considers appropriate;

(8) storage capacities and inventories;

(9) storage operating parameters including but not limited to injection and withdrawal rates and pressures and the sustainability of those rates and pressures; and

(10) mismatches between supply, demand and capacity.(d) When preparing an annual planning review VENCorp must:

(1) take into account:

(A) the information provided by Participants under clauses 5.2.4(b), (c) and (d);

(B) anticipated future growth in the demand for gas in Victoria; and

(C) committed projects for new or additional gas production facilities or extension or expansion of a transmission system or a distribution pipeline; and

(2) subject to clause 5.2.4(f), publish the assumptions upon which it bases its annual planning reviews.

(e) If VENCorp becomes aware of any information that materially alters the most recently published annual planning review, VENCorp must update that annual planning review as soon as practicable, and provide Participants with the details of that update.

[Clause 5.2.3 deleted: By Notice published in the Government Gazette G7, dated 15 February 2001, effective from 21 February 2001]

5.2.4 Participant disclosure obligations(a) All Participants must provide to VENCorp forecasts in respect of the matters set out in

clause 5.2.4(b) as follows:

(1) annual forecasts for each year in the five year period commencing on 1 January in each year must be provided to VENCorp by 30 September in the immediately preceding year; and



(2) monthly forecasts for each month in the twelve month period commencing on 1 January in each year must be provided to VENCorp by 30 September in the immediately preceding year.

(b) Information supplied by each Participant must include forecasts in respect of the following matters, where relevant:

(1) available and prospective supply available to that Participant and the source of that supply;

(2) storage capacities and inventory available to that Participant;(3) gas supply, storage, transmission and distribution projects, including pipeline

extensions and expansions; and

(4) storage operating parameters, including injection and withdrawal rates and pressures and sustainability of those rates and pressures.

(c) Market Customers and Distributors must include the following additional forecasts, where relevant, with the information provided to VENCorp under clause 5.2.4(a):

(1) most probable peak daily demand and peak hourly demand in respect of each system withdrawal zone; and

(2) anticipated material constraints on the capacity of the distribution pipeline in respect of each system withdrawal zone, where that constraint is likely to have an effect on the operation of the transmission system.

(d) Transmission Pipeline Owners and Storage Providers must include the following additional forecasts, where relevant, with the information provided to VENCorp under clause 5.2.4(a):

(1) the availability of pipeline equipment; (2) details of any constraints on the availability of pipeline equipment;(3) the time and duration of any proposed maintenance;(4) full details of the proposed maintenance;

(5) the longest period likely to be required to recall into operation relevant pipeline equipment during the course of maintenance; and

(6) operational requirements for maintenance which is to be performed including:

(A) the gas pressure under which the maintenance will be performed;

(B) gas requirements for testing; and

(C) compressor test operations required,

and this additional information must be provided to VENCorp in accordance with clause 5.2.4(a) and also in the form of week-ahead forecasts commencing from Monday in each week which must be provided to VENCorp by no later than the immediately preceding Wednesday.

(e) A Participant must notify VENCorp as soon as practicable having regard to the nature of the change if it becomes aware of a material change to information previously provided under clauses 5.2.4(b), (c) and (d).

(f) Subject always to clause 5.2.4(g), information provided to VENCorp under this clause 5.2.4 is confidential information and is subject to the confidentiality provisions set out in clause 5.4 and VENCorp must comply with the confidentiality obligations imposed on VENCorp under clause 5.4 when dealing with information provided to it under this clause 5.2.4.



(g) Nothing in clause 5.2.4(f) is to be read or construed as restricting VENCorp from:

(1) assessing the information provided by Participants under this clause 5.2 and including an aggregation of that information in any report which VENCorp is required to prepare under this clause 5.2; or

(2) preparing, publishing or making available any report which it is required to prepare under this clause 5.2.

(h) Participants must provide the information required under this clause 5.2.4 in good faith and must take all reasonable measures to ensure that the information is accurate.

5.2.5 Disclosure exemptions (1) VENCorp, in its absolute discretion, may exempt a Participant from all or any of the

disclosure obligations under clauses 5.2.4(b), (c) and (d).

(2) VENCorp, in its absolute discretion, may require a Participant, who has previously been exempted from the disclosure obligations under clauses 5.2.4(b), (c) and (d), to make all or any of the disclosures required under those clauses.

5.2.6 Maintenance planning(a) VENCorp must, on the basis of information provided to VENCorp under clause 5.2.4(d),

coordinate all maintenance planned by Transmission Pipeline Owners or Storage Providers to ensure that system security is not threatened as a consequence of the unavailability of pipeline equipment undergoing maintenance.

(b) VENCorp, in consultation with Pipeline Owners and Storage Providers, must develop, prepare and maintain written operating procedures which must set out relevant information pertaining to the coordination of maintenance including:

(1) procedures for facilitating the exchange of information; and

(2) procedures pursuant to which Pipeline Owners and Storage Providers may take offline plant and equipment relevant to the operation of the market, including pipeline equipment.

(c) A Transmission Pipeline Owner which has provided information under clause 5.2.4(d), concerning time and duration of proposed maintenance, must act in accordance with those forecasts unless:

(1) those forecasts are updated in the manner specified in the operating procedures more than five days before that maintenance is due to commence; or

(2) if the update is to occur within five days of the day on which that maintenance was due to commence, consent to an update has been obtained from VENCorp in the manner specified in the operating procedures.

(d) If VENCorp believes that any maintenance proposed by a Pipeline Owner or Storage Provider will threaten system security, VENCorp must notify the relevant Pipeline Owner or Storage Provider accordingly and that Pipeline Owner or Storage Provider must co-operate with VENCorp in good faith to minimise any threat to system security which in VENCorp’s reasonable opinion would be likely to result from that proposed maintenance.

(e) VENCorp may direct a Pipeline Owner or Storage Provider to cancel, delay or suspend any maintenance if in VENCorp’s reasonable opinion:

(1) the Pipeline Owner or Storage Provider is conducting or proposing to conduct maintenance in a way which does not minimise threats to system security; and

(2) the relevant pipeline equipment will not materially be damaged by deferring that maintenance.



(f) If there is a breakdown, or VENCorp reasonably believes there is likely to be a breakdown, of any pipeline equipment which VENCorp or the relevant Pipeline Owner reasonably believes could threaten system security, the Pipeline Owner or Storage Provider which owns that pipeline equipment must immediately provide VENCorp with:

(1) full details of the breakdown, or threatened breakdown; and

(2) its planned response to the breakdown, or threatened breakdown,

and that Pipeline Owner or Storage Provider must co-operate with VENCorp in good faith to minimise any threat to system security which in VENCorp’s reasonable opinion would be likely to result from that breakdown.

(g) If VENCorp becomes aware of defective pipeline equipment, VENCorp must promptly provide all relevant Pipeline Owners or Storage Providers with full details of the defect.



5.3 MDQ AUTHORISATION

5.3.1 Agreement for provision of transportation services(a) Prior to the commencement date, VENCorp and a Transmission Pipeline Owner must

enter into a service envelope agreement, and thereafter must at all times ensure that there is a valid service envelope agreement in force between them, under which the Transmission Pipeline Owner agrees, amongst other things, to provide to VENCorp gas transportation services and pipeline capacity by means of the pipelines of that Transmission Pipeline Owner which form part of the transmission system on terms which are not inconsistent with:

(1) the access arrangement, if any, of the Transmission Pipeline Owner; and

(2) the Tariff Order, if applicable.

(b) A service envelope agreement must specify the capacity of the Transmission Pipeline Owner’s pipelines available for use by VENCorp at system points on the pipeline under various operating conditions.

(c) If VENCorp and a Transmission Pipeline Owner are unable to reach agreement (or to continue to agree, as the case may be) for the purposes of entering and maintaining a service envelope agreement as required under clause 5.3.1(a), the Regulator may refer the matter for resolution by a suitably qualified independent person appointed by the Regulator who, in the reasonable opinion of the Regulator:(1) has an understanding of the gas industry, generally;

(2) has an understanding about the roles of both VENCorp and the Transmission Pipeline Owner in the gas industry operating in Victoria;

(3) does not have any interests which could conflict with an impartial resolution of the disagreement; and

(4) is appropriate in all the circumstances to hear and resolve the disagreement.

(d) The independent person appointed by the Regulator under clause 5.3.1(c) may request from VENCorp and the Transmission Pipeline Owner any relevant document, information, statement and other materials that the independent person considers to be reasonably necessary to enable the disagreement to be resolved and VENCorp and the Transmission Pipeline Owner must promptly comply with all such requests.

(e) The independent person appointed by the Regulator under clause 5.3.1(c) must do all things reasonably necessary to resolve the disagreement within thirty business days of referral of the matter by the Regulator, if necessary by making a decision about the manner in which the unresolved matter is to be addressed in the service envelope agreement between the parties.

(f) VENCorp and the Transmission Pipeline Owner must ensure that the resolution of the disagreement by the independent person appointed by the Regulator under clause 5.3.1(c) is reflected in a service envelope agreement which is duly entered between them within five business days of the resolution of the disagreement under clause 5.1.3(e) and if they fail to enter into or modify an existing service envelope agreement which reflects the resolution by the independent person, the Regulator may arrange for an appropriate agreement to be prepared which:

(1) reflects the resolution of the disagreement by the independent person; and

(2) if there was an existing service envelope agreement, reflects the provisions of the existing service envelope agreement to the extent that those provisions have not



been modified by agreement between VENCorp and the Transmission Pipeline Owner or the subject of a disagreement between VENCorp and the Transmission Pipeline Owner under clause 5.3.1(c).

(g) If the Regulator arranges for a service envelope agreement to be prepared or modified under clause 5.3.1(f):

(1) the Regulator must send the completed service envelope agreement to VENCorp and the Transmission Pipeline Owner, respectively, as soon as practicable; and

(2) VENCorp and the Transmission Pipeline Owner must execute that service envelope agreement within 5 business days of receiving it from the Regulator.

(h) The independent person is to be appointed by the Regulator under clause 5.3.1(c) to act as an expert and not as an arbitrator and the rules of evidence do not apply.

(i) If, at the time of any disagreement between VENCorp and the Transmission Pipeline Owner under clause 5.3.1(c), there is a service envelope agreement in place between VENCorp and the Transmission Pipeline Owner or a service envelope agreement has recently expired or terminated, that existing or previous service envelope agreement, as the case may be, is deemed to continue to have full force and effect between VENCorp and the Transmission Pipeline Owner until a new or modified service envelope agreement has been entered between them.

5.3.2 Initial allocation of authorised MDQ(a) Prior to the commencement date, VENCorp must allocate or reserve authorised MDQ as

follows:

(1) VENCorp must allocate an amount of authorised MDQ in respect of all withdrawals of gas from tariff V withdrawal points;

(2) a Customer is to be allocated authorised MDQ in respect of gas which the Customer withdraws at a tariff D withdrawal point on the basis of past and/or existing contractual arrangements, or on some other basis that VENCorp reasonably considers to be appropriate in all the circumstances;

(3) an appropriate quantity of authorised MDQ may be allocated to a Retailer or a Transmission Pipeline Owner in respect of withdrawals of gas from a system withdrawal point for supply into an interconnected transmission pipeline where VENCorp reasonably believes it is appropriate to do so; and

(4) an appropriate quantity of authorised MDQ may be reserved for such period of time as VENCorp reasonably determines for the purposes of allocation to Customers in respect of gas which is:

(A) withdrawn at a tariff D withdrawal point; and

(B) supplied through the transmission pipeline located between Chiltern to Rutherglen to Koonoomoo in Victoria.

[Clause 5.3.2(b) deleted: Order in Council, 10 March 1999, published in the Government Gazette dated 11 March 1999]

(c) VENCorp must notify:

(1) each Retailer whose Customers are allocated authorised MDQ under clause 5.3.2(a)(2) or 5.3.2(a)(4) of the amount of authorised MDQ allocated to each of its Customers;



(1A) each Market Participant of the amount of authorised MDQ allocated in accordance with clause 5.3.2(a)(1);

(2) each Market Customer who is allocated authorised MDQ under clause 5.3.2(a)(2) or 5.3.2(a)(4) of the amount of the authorised MDQ allocated to that Market Customer; and

(3) any Transmission Pipeline Owner and any Retailer allocated authorised MDQ under clause 5.3.2(a)(3) of the amount of authorised MDQ, if any, allocated to them.

(d) A Retailer who sells gas to Customers to whom authorised MDQ is allocated under clause 5.3.2(a)(2) must notify each of its Customers in respect of whom gas is withdrawn at a tariff D withdrawal point of that Customer’s authorised MDQ.

(e) VENCorp must advise a Customer of that Customer’s authorised MDQ on request by that Customer.

(f) Subject to clauses 5.3.2(c), (d) and (e) and clause 5.3.3(e), information relating to authorised MDQ, including the identity of the Customer or person to whom it has been allocated, is confidential information.

(g) Subject to clause 5.3.5 if a Customer changes the Retailer from whom it purchases gas, the Customer’s authorised MDQ allocated under clauses 5.3.2 or 5.3.4:

(1) remains assigned to that Customer; and

(2) is not varied,

as a result of the change of Retailer.(h) Either before or within a reasonable period after the allocation of authorised MDQ under

clause 5.3.2(a), VENCorp must prepare and publish a report detailing:

(1) the total amount of authorised MDQ that it has allocated under clause 5.3.2;

(2) the aggregate amount of authorised MDQ allocated in respect of withdrawals of gas from tariff V withdrawal points;

(3) the aggregate amount of authorised MDQ allocated to Customers in respect of withdrawals of gas from tariff D withdrawal points; and

(4) a report which describes the methodology applied by VENCorp in making those allocations of authorised MDQ.

[Clause 5.3.3(aa) deleted: Order in Council dated 28 April 1999. published in the Government Gazette dated 13 May 1999]



5.3.3 Allocations of authorised MDQ and AMDQ credit certificates for pipeline extensions or expansions

(a) If a Transmission Pipeline Owner extends or expands, or proposes to extend or expand, its pipeline or pipelines, it must consult with VENCorp for the purposes of reaching agreement with VENCorp as to the increase in capacity of the relevant pipeline which results from the extension or expansion.

(ab) Where a Transmission Pipeline Owner undertakes an extension or expansion and that extension or expansion is a covered extension or expansion and the cost of the extension or expansion is entirely added to the Transmission Pipeline Owner’s capital base on the basis that the tests in either section 8.16(a) and section 8.16(b)(ii) or section 8.16(a) and section 8.16(b)(iii) of the Access Code are met by the time the extension or expansion is commissioned, additional authorised MDQ which becomes available for allocation as a consequence of that extension or expansion is to be allocated in accordance with clause 5.3.4.

(ac) Where a Transmission Pipeline Owner undertakes an extension or expansion and that extension or expansion is a covered extension or expansion and a part only of the cost of the extension or expansion is added to the Transmission Pipeline Owner’s capital base on the basis that the tests in either section 8.16(a) and section 8.16(b)(ii) or section 8.16(a) and section 8.16(b)(iii) of the Access Code are met by the time the extension or expansion is commissioned, then:

(1) that portion of the additional authorised MDQ made available as a consequence of the extension or expansion which is associated with that part is to be allocated in accordance with clause 5.3.4; and

(2) the remaining portion of the additional authorised MDQ or AMDQ credit certificates, as the case may be, must be allocated in accordance with clause 5.3.3(b),

provided that this clause 5.3.3(ac) shall not apply if the relevant Transmission Pipeline Owner cannot demonstrate to the reasonable satisfaction of VENCorp that the Regulator has agreed with the Transmission Pipeline Owner that an amount (and if so what amount) of additional capacity is associated with that part, and if for that reason this clause 5.3.3(ac) does not apply then clause 5.3.3(ab) shall apply instead.

(b) Subject to clause 5.3.3(ba), in any case where clause 5.3.3(ab) or 5.3.3(ac)(1) do not apply, VENCorp must allocate:

(1) such quantity of additional authorised MDQ or AMDQ credit certificates, as the case may be, which is made available by the relevant extension or expansion;

(2) to such Market Participants;

(3) for use within such specified withdrawal zones or for use at system injection points, as the case may be; and

(4) for such period,

as the relevant Transmission Pipeline Owner directs.

(ba) Where an amount of AMDQ credit certificates is to be allocated to a Market Participant under clause 5.3.3(b) in respect of injections of gas at a system injection point other than at Longford, VENCorp must only make such an allocation of AMDQ credit certificates to the Market Participant:(1) where the Market Participant requests the allocation; and



(2) in accordance with the direction of the relevant Transmission Pipeline Owner.and VENCorp may specify any conditions to apply to that allocation of AMDQ credit certificates as VENCorp reasonably determines and as agreed with the relevant Transmission Pipeline Owner.

(c) Subject to clause 5.3.3(ba), VENCorp must not allocate authorised MDQ or AMDQ credit certificates under this clause 5.3.3 except in accordance with a direction of the relevant Transmission Pipeline Owner under clause 5.3.3(b), provided that this clause 5.3.3(c) shall in no way restrict the ability of VENCorp to allocate authorised MDQ or AMDQ credit certificates in any case where clause 5.3.4 applies (notwithstanding that such an application of clause 5.3.4 is by operation of this clause 5.3.3).

(d) If additional authorised MDQ or AMDQ credit certificates have been allocated by VENCorp as a consequence of an extension or expansion, VENCorp and the relevant Transmission Pipeline Owner must by no later than the date on which the additional authorised MDQ or AMDQ credit certificates are allocated, modify an existing service envelope agreement, to reflect that additional capacity of the relevant pipeline as agreed under clause 5.3.3(a) which results from the extension or expansion and if they are unable to agree, the provisions of clauses 5.3.1(c) to (i), inclusive, are to apply.

[Sub-clause 5.3.3(e), (f) and (g) deleted: notice published in the Government Gazette dated 5 July 2001 and corrigendum published in the Government Gazette dated 30 August 2001]

(h) In this clause 5.3.3, “covered” means covered by the Transmission Pipeline Owner’s access arrangement.

5.3.4 Subsequent allocations and re-allocations of authorised MDQ(a) Where VENCorp and the relevant Transmission Pipeline Owner agree that there is

available capacity on a pipeline in accordance with the relevant service envelope agreement in respect of which:

(1) VENCorp is not prevented by clause 5.3.3(c) from allocating authorised MDQ; and

(2) VENCorp has neither allocated authorised MDQ nor reserved an amount of authorised MDQ in accordance with clause 5.3.2(a)(4),

VENCorp must allocate authorised MDQ up to that available capacity to any person who seeks an allocation of authorised MDQ in respect of a delivery point or system withdrawal point, in accordance with this clause 5.3.4.

(b) If a tariff V withdrawal point becomes designated as a tariff D withdrawal point, then VENCorp is to allocate authorised MDQ to the Customer, who withdraws gas at that tariff D withdrawal point in a manner which, in VENCorp’s reasonable opinion, is fair and equitable, and VENCorp should make a proportionate reduction to the amount of authorised MDQ assigned to tariff V withdrawal points.

[Clauses 5.3.4(c) and (d) deleted: Order in Council dated 10 March 1999, published in the Government Gazette 11 March 1999]

(e) VENCorp must allocate authorised MDQ under clause 5.3.4(a) as follows:

(1) if there is sufficient available authorised MDQ to satisfy the requirements of all persons who have requested an allocation of authorised MDQ, VENCorp must allocate the available authorised MDQ to each of those persons in respect of a



delivery point or system withdrawal point at which each of those persons withdraw or propose to withdraw gas, in accordance with their requirements; and

(2) if there is insufficient available authorised MDQ to satisfy the requirements of all persons who have requested an allocation of authorised MDQ, VENCorp must conduct an auction amongst all persons from whom VENCorp has received requests for authorised MDQ and allocate the available authorised MDQ to the persons who offer the highest amount for that authorised MDQ.

(ea) Allocation of authorised MDQ made in accordance with clause 5.3.4(e) will be effective only in respect of a delivery point or system withdrawal point at which the person applied to VENCorp for the allocation of authorised MDQ.

(f) VENCorp must develop procedures pursuant to which it will allocate available authorised MDQ under clause 5.3.4(e)(2).

(g) All monies received by VENCorp from an auction conducted in accordance with clause 5.3.4(e)(2) are to be used by VENCorp to offset its costs for the next financial year calculated in accordance with the Tariff Order.

(h) This clause 5.3.4, and the principles and procedures VENCorp develops and applies to effect an allocation of available authorised MDQ, comprise the queuing policy of VENCorp as required under the Access Code.

5.3.5 Transfer of authorised MDQ or AMDQ credit certificates(a) A person that has acquired authorised MDQ or AMDQ credit certificates in accordance with

this clause 5.3 may transfer the whole or a part of that authorised MDQ or AMDQ credit certificates to another person in accordance with this clause 5.3.5 and subject to transfer procedures developed in accordance with this clause 5.3.5.

[Clause 5.3.5(aa) deleted: notice published in the Government Gazette dated 5 July 2001]

(b) VENCorp must develop and publish procedures for the transfer of authorised MDQ or AMDQ credit certificates between parties in accordance with this clause 5.3.5 and must do so in consultation with Participants and other persons VENCorp reasonably considers may have an interest in the development of those procedures.

5.3.6 Relinquishment of authorised MDQ or AMDQ credit certificate(a) Subject to clause 5.3.6(b), if a person holds authorised MDQ or AMDQ credit certificates in

accordance with these rules and ceases to be a Participant or Market Participant in accordance with these rules, or in the case of a Customer, is disconnected from the transmission system or a distribution pipeline, that person’s entitlement to the authorised MDQ or AMDQ credit certificates will revert to VENCorp for reallocation to other persons in accordance with clause 5.3.4 unless that person transfers that authorised MDQ in accordance with clause 5.3.5.

(b) If a person:

(1) to whom authorised MDQ or AMDQ credit certificates has been allocated under clause 5.3.3, or

(2) to whom authorised MDQ or AMDQ credit certificates originally allocated under clause 5.3.3 has been transferred in accordance with clause 5.3.5,



ceases to be a Participant or Market Participant in accordance with these rules, or in the case of a Customer, is disconnected from the transmission system or a distribution pipeline, that person’s entitlement to the authorised MDQ or AMDQ credit certificates will revert to the relevant issuing Transmission Pipeline Owner unless that person transfers that authorised MDQ or AMDQ credit certificates in accordance with clause 5.3.5.



5.4 CONFIDENTIALITY

5.4.1 Confidentiality(a) Each Participant and VENCorp must keep confidential any confidential information which

comes into the possession or control of that Participant or VENCorp of which the Participant or VENCorp (as the case may be) becomes aware.

(b) A Participant and VENCorp:

(1) must not disclose confidential information to any person except as permitted by these Rules;

(2) must only use or reproduce confidential information for the purpose for which it was disclosed or another purpose contemplated by these Rules; and

(3) must not permit unauthorised persons to have access to confidential information.MSO Rules Amendments to facilitate Full Retail Contestability:




(b) A Participant and VENCorp:

(1) must not disclose confidential information to any person except as permitted by these Rules or the Retail Gas Market Rules;

(2) must only use or reproduce confidential information for the purpose for which it was disclosed or another purpose contemplated by these Rules or the Retail Gas Market Rules; and

(3) must not permit unauthorised persons to have access to confidential information.

(c) Each Participant and VENCorp must use all reasonable endeavours:

(1) to prevent unauthorised access to confidential information which is in the possession or control of that Participant or VENCorp (as the case may be); and

(2) to ensure that any person to whom it discloses confidential information observes the provisions of this clause 5.4 in relation to that information.

(d) Without limiting the provisions of clauses 5.4.1(a), (b) and (c), each Participant which is a Distributor must not disclose confidential information relating to a Retailer which is not a related body corporate of that Distributor to a Retailer which is a related body corporate of the Distributor.

5.4.2 ExceptionsThis clause 5.4 does not prevent:

(a) the disclosure, use or reproduction of information if the relevant information is at the time generally and publicly available other than as a result of breach of confidence by the Participant or VENCorp who wishes to disclose, use or reproduce the information or any person to whom the Participant or VENCorp (as the case may be) has disclosed the information;

(b) the disclosure of information by a Participant or VENCorp or by persons to whom the Participant or VENCorp (as the case may be) has disclosed that information to:



(1) an employee or officer of the Participant or a related body corporate (other than a related body corporate of the Retailer) of the Participant; or

(2) a legal or other professional adviser, auditor or other consultant of the Participant or VENCorp (as the case may be),

which requires the information for the purposes of these Rules, or for the purpose of advising the Participant or VENCorp in relation these Rules;





(b) the disclosure of information by a Participant or VENCorp or by persons to whom the Participant or VENCorp (as the case may be) has disclosed that information to:

(1) an employee or officer of the Participant or a related body corporate of the Participant (other than, in respect of the information referred to in clause 5.4.1(d), the Retailer that is a related body corporate of a Distributor) (other than a related body corporate of the Retailer) of the Participant; or

(2) a legal or other professional adviser, auditor or other consultant of the Participant or VENCorp (as the case may be),

which requires the information for the purposes of these Rules, or for the purpose of advising the Participant or VENCorp in relation these Rules;

(c) the disclosure, use or reproduction of information with the consent of the person or persons who provided the relevant information under these Rules;

(d) the disclosure, use or reproduction of information to the extent required by law or by a lawful requirement of:

(1) any government authority having jurisdiction over a Participant or VENCorp or its related bodies corporate; or

(2) any stock exchange having jurisdiction over a Participant or VENCorp or its related bodies corporate;

(e) the disclosure, use or reproduction of information if required in connection with legal proceedings, arbitration, expert determination or other dispute resolution mechanism relating to these Rules, or for the purpose of advising a person in relation thereto;

(f) the disclosure, use or reproduction of information which is trivial in nature;

(g) the disclosure of information which is required to protect the safety of personnel or equipment;

(h) the disclosure, use or reproduction of information by or on behalf of a Participant or VENCorp to the extent reasonably required in connection with the Participant's or VENCorp’s financing arrangements (as the case may be), investment in a Participant or a disposal of a Participant's assets;

(i) the disclosure of information to the Regulator or any other regulatory authority having jurisdiction over a Participant, pursuant to these Rules or otherwise;

(j) the disclosure, use or reproduction of information of an historical nature in connection with the preparation and giving of reports under these Rules; or



(k) the disclosure, use or reproduction of information as an unidentifiable component of an aggregate sum.

5.4.3 ConditionsIn the case of a disclosure under clause 5.4.2(b), 5.4.2(e) or 5.4.2(h) prior to making the disclosure the Participant or VENCorp (as the case may be) who wishes to make the disclosure must inform the proposed recipient of the information that it is confidential information and must take appropriate precautions to ensure that the recipient keeps the information confidential in accordance with the provisions of this clause 5.4 and does not use the information for any purpose other than that permitted under clause 5.4.1.

5.4.4 Indemnity to VENCorpEach Participant indemnifies VENCorp against any claim, action, damage, loss, liability, expense or outgoing which VENCorp pays, suffers, incurs or is liable for in respect of any breach by that Participant or any officer, agent or employee of that Participant of this clause 5.4.

5.4.5 SurvivalNotwithstanding any other provision of these Rules, a person must continue to comply with this clause 5.4 for three years after it has ceased to be a Participant.

5.4.6 VENCorp informationVENCorp must develop and, to the extent practicable, implement a policy:

(a) to protect information which it acquires pursuant to the VENCorp functions from use or access which is contrary to the provisions of these Rules;

(b) to protect information which is commercially sensitive from use or access by members of the board of directors of VENCorp who are officers, directors or employees of a Participant; and

(c) to disseminate such information in accordance with its rights, powers and obligations in a manner which promotes the orderly operation of the market.



CHAPTER 6. INTERVENTION AND MARKET SUSPENSION



6.1 OVERVIEW

6.1.1 Scope of chapter 6This chapter 6 sets out the rules which determine:

(a) the procedures which must be established by VENCorp and Participants to ensure that they are able to take all necessary actions in an emergency;

(b) the procedures to be followed by VENCorp and Participants in an emergency;

(c) the procedures which are to take effect in the event of a threat to system security;

(d) the circumstances and manner in which VENCorp may intervene or suspend the market; and

(e) the manner in which Participants will be compensated following intervention in or suspension of the market by VENCorp.

6.1.2 Preparation and responses(a) VENCorp is responsible for giving directions and co-ordinating the actions which are to be

taken by Participants when:

(1) there is an emergency;

(2) there is a threat to system security;

(3) there is an event of force majeure; or

(4) the market is suspended.

(b) Participants acknowledge that:

(1) the conveyance of gas through the transmission system involves risks to public safety and property and therefore that the provisions of this chapter 6 are appropriate and reasonable;

(2) in an emergency their business interests will be subordinate to the need for VENCorp to implement emergency procedures in accordance with clause 6.2.2 and to make declarations and issue emergency directions under clause 6.5; and

(3) in an emergency, VENCorp may issue emergency directions and require gas injections to be made into, or withdrawals of gas to be taken from, the transmission system to be varied in accordance with this chapter 6 even though those injections or withdrawals are not made in accordance with the remainder of these Rules.

6.1.3 Liability and discretion of VENCorp(a) No conduct by VENCorp or a Participant:

(1) in the event of:

(A) a threat to system security; or

(B) an emergency; or

(C) an event of force majeure; or

(D) suspension of the market;(2) in compliance with emergency procedures; or

(3) in accordance with this chapter 6,

will constitute a breach of the remainder of these Rules or the Access Code or the access arrangement of any Pipeline Owner, and in particular VENCorp will not be liable for any



loss incurred by a Participant as a result of any action taken by VENCorp under this chapter 6.

(b) Subject to clause 6.9.1, nothing in this chapter 6 is to be taken to limit the ability of VENCorp to take any action or procedure under this chapter 6 which VENCorp considers in its absolute discretion to be necessary to protect the public or property.



6.2 EMERGENCIES

6.2.1 Emergency(a) An emergency will be deemed to occur when:

(1) VENCorp reasonably believes there to be a situation which may:

(A) threaten the personal safety of any person;

(B) cause material damage to the transmission system;

(C) cause material damage to a distribution pipeline and impact on the operation of the transmission system or the market;

(D) cause material damage to any property, plant or equipment; or

(E) constitute a threat to system security,

and VENCorp in its absolute discretion considers that the situation is an emergency and declares there to be an emergency; or

(2) the Governor in Council by proclamation declares there to be an emergency under Part 9 of the Gas Industry Act.

[Sub clause 6.2.1(a)(3) deleted: Order in Council dated 29 June 99, published in Government Gazette 8 July 1999]

(aa) If VENCorp receives notice that the Office of Gas Safety has issued a direction under sections 106 or 107 of the Gas Safety Act 1997 (Vic), VENCorp may, in its absolute discretion, treat the issue of that direction as establishment that one or more of the conditions specified in clause 6.2.1(a)(1) are satisfied and as such may declare there to be an emergency.

(b) An escape of gas is not itself an emergency but an escape of gas may be a circumstance which gives rise to an emergency.

(c) A Participant must notify VENCorp as soon as practicable of:

(1) any event or situation of which the Participant becomes aware where, in the reasonable opinion of the Participant, that event or situation is of a kind described in clause 6.2.1(a)(1); and

(2) any action taken by the Participant under its safety plan and safety procedures or otherwise in response to that event or situation.

(d) VENCorp may specify procedures from time to time for communicating to Participants the existence of an emergency and all relevant information relating to the emergency.

(e) Subject to clause 6.2.1(f), the existence of an emergency under clause 6.2.1(a)(1) will be determined by VENCorp in its absolute discretion, irrespective of the cause of the emergency, and whether VENCorp or any other person has caused or contributed to the emergency.

(f) Notwithstanding any other provision of this clause 6.2, Participants and VENCorp acknowledge that the Office of Gas Safety may give directions which override an emergency direction given by VENCorp.

(g) Each Participant must use its best endeavours to ensure that its safety plan (if any) permits it to comply with emergency directions.



(h) An emergency will continue until such time as VENCorp determines that the emergency has ended.

(i) When an emergency has ended in accordance with clause 6.2.1(h), VENCorp must notify all Participants that the emergency has ended.

6.2.2 Emergency procedures(a) Emergency procedures:

(1) are the procedures to be taken by VENCorp, Transmission Pipeline Owners, Interconnected Pipeline Owners, Distributors, Retailers and Traders to or at the direction of VENCorp to:

(A) re-establish system security;

(B) avert or reduce the scale of an emergency;

(C) reduce the probability or probable scale of an emergency;

(D) prepare for the occurrence of an emergency; and

(E) restore gas supply and normal operation of the transmission system in the event of an emergency.

(2) regulate how disputes related to the implementation of the emergency procedures are to be resolved during a declared emergency.

(b) Emergency procedures may:(1) classify emergencies into different categories or levels having regard to their likely

scale or to such other matters as VENCorp thinks fit; and

(2) require a Participant to take action, or not to take action, in accordance with emergency directions given by VENCorp.

(c) Subject to clause 6.2.2(d), VENCorp must, in consultation with the Minister, the Office of Gas Safety and Participants:

(1) prepare; and

(2) review from time to time,

a document which sets out the emergency procedures.

(ca) The document referred to in clause 6.2.2(c) must include the document referred to in clause 6.4.3(b)

(d) VENCorp must ensure that to the extent that the emergency procedures may affect Participants or require Participants to take or refrain from taking certain actions, the emergency procedures developed and reviewed by VENCorp under clause 6.2.2(c) are consistent with the safety plans of Participants.

(e) VENCorp must make available the emergency procedures to each Participant within seven days after each occasion on which the emergency procedures have been updated.

(f) VENCorp, Transmission Pipeline Owners, Interconnected Pipeline Owners, Distributors, Retailers and Traders must comply with the emergency procedures.



6.3 EMERGENCY PLANNING BY PARTICIPANTS

6.3.1 Participant emergency contacts(a) Each Participant must provide VENCorp with:

(1) a single telephone number and facsimile number at which a representative of the Participant is contactable by VENCorp, 24 hours a day; and

(2) the name and title of the Participant's representative who is contactable at those numbers.

(b) The representative of each Participant must be a person having appropriate authority and responsibility within the Participant's organisation to act as the primary contact for VENCorp in the event of an emergency.

(c) Each Participant must immediately notify VENCorp of a change to the details required under clause 6.3.1(a) and where possible in advance.

6.3.2 Participant procedures(a) To the extent that:

(1) a Participant is not required to have its own safety plan; or

(2) a Participant’s safety plan does not provide for the Participant to respond to all events and situations included in clause 6.2.1(a),

that Participant must establish and maintain its own internal safety procedures necessary to enable it and, where relevant, its Customers to comply with emergency directions and this chapter 6.

(b) Each Participant must ensure that the safety procedures it establishes under clause 6.3.2(a) are consistent with the emergency procedures and its safety plan (if any).

6.3.3 Emergency procedures awareness(a) Each Participant must at all times ensure that all of its relevant officers and staff and,

where relevant, its Customers, are familiar with the emergency procedures and the Participant’s safety procedures.

(b) For the purposes of clause 6.3.3(a), relevant officers and staff are those whose functions or areas of responsibility are such that they are likely to be required to make decisions or take action in an emergency.



6.4 EMERGENCY CURTAILMENT OF CUSTOMERS

6.4.1 Distribution Customers - curtailment information(a) Subject always to the requirement that a Distributor must use its best endeavours to

provide information to VENCorp under this clause 6.4.1 in a way that does not reveal the identity of a Customer, each Distributor must provide information to VENCorp in accordance with clause 6.4.1(b), for each transfer point relating to that Distributor’s distribution pipelines, by no later than the commencement date and thereafter by no later than 28 February in each year.

(b) Unless otherwise agreed by VENCorp, the list provided to VENCorp under clause 6.4.1(a) must set out for each transfer point referred to in clause 6.4.1(a):

(1) the system withdrawal zone in which that transfer point is located;

(2) the name and address of the Distributor on whose distribution pipeline that transfer point is located;

(3) a single telephone number and facsimile number at which one or more representatives of the Distributor having appropriate authority and responsibility within the Distributor's organisation to act as the primary contact for VENCorp in the event of an emergency, are contactable by VENCorp, 24 hours a day and the name and title of those representatives of the Distributor who are contactable at those numbers;

(4) the number of Distribution Customers which withdraw gas from any distribution delivery point on the Distributor’s distribution pipelines after that gas has passed through each of those transfer points;

(5) the aggregate size of demand of all Distribution Customers represented by that transfer point;

(6) the type of demand of all Distribution Customers represented by that transfer point; and

(7) the time it would take to implement curtailment in respect of the Distribution Customers represented by that transfer point.

(c) Each Distributor must immediately notify VENCorp of a change to the details required under clause 6.4.1(b) and where possible in advance.

6.4.2 Transmission Customers - curtailment information(a) By no later than the commencement date and thereafter by no later than 28 February in

each year, each Transmission Customer must provide to VENCorp the information set out in clause 6.4.2(b) and if that Transmission Customer is not a Market Customer, then the Transmission Customer must arrange for the Retailer from whom it purchases gas to provide that information on its behalf.

(b) The information to be provided to VENCorp under clause 6.4.2(a) must set out:

(1) the name and address of the Transmission Customer;(2) a single telephone number and facsimile number at which a representative of the

Transmission Customer is contactable by VENCorp, 24 hours a day;

(3) the name and title of the Transmission Customer’s representative who is contactable at those numbers and is a person having appropriate authority and responsibility within the Transmission Customer’s organisation to act as the primary contact for VENCorp in the event of an emergency;



(4) the system withdrawal zone in which that transmission delivery point is located;

(5) the maximum daily and hourly quantity of the Transmission Customer;(6) the type of demand of the Transmission Customer;(7) the time it would take to implement curtailment in respect of that Transmission

Customer; and

(8) the minimum required pressure at the transmission delivery point.(c) The person responsible for providing the information to VENCorp under clause 6.4.2(a)

must immediately notify VENCorp of a change to the details required under clause 6.4.2(b) and where possible in advance.

6.4.3 Emergency curtailment list(a) Subject to clause 6.4.3(d) VENCorp must, by the end of March in each year prepare an

emergency curtailment list which:

(1) is to be based on the information received from Distributors under clause 6.4.1;

(2) is to incorporate the information provided to VENCorp by or on behalf of each Transmission Customer under clause 6.4.2 in respect of the transmission delivery points at which those Transmission Customers withdraw gas; and

(3) must set out, by system withdrawal zone, the order in which the supply of gas to Customers, including Transmission Customers, will be curtailed.

(aa) An emergency curtailment list must provide for the regulation of the available supply of gas having regard to the needs of the community

(ab) The Minister must be consulted by VENCorp on the emergency curtailment list prior to it being made available to each Distributor and Transmission Customer in accordance with clause 6.4.3(b).

(ac) The Minister may from time to time require VENCorp to initiate a review of the whole or part of the emergency curtailment list.

(ad) In any instance where the Minister acting pursuant to clause 6.4.3(ac) requires VENCorp to initiate a review of the whole or part of the emergency curtailment list, the Minister may further require that VENCorp use the public consultation procedures to consult prior to that emergency curtailment list being finalised.

(ae) Nothing in this clause 6.4.3 shall limit:

(i) the powers of the Minister acting under section 207 of the Gas Industry Act to give directions (including directions providing for the regulation of the available supply of gas having regard to the needs of the community), notwithstanding that those directions may differ from the emergency curtailment list; or

(ii) the powers of the Director of the Office of Gas Safety acting under the Gas Safety Act 1997 (Vic) to give directions (including directions providing for the regulation of the available supply of gas having regard to the needs of the community), notwithstanding that those directions may differ from the emergency curtailment list.

(b) VENCorp must make available to each Distributor and Transmission Customer and to the Office of Gas Safety and the Minister a document (which shall include the emergency curtailment list) which sets out categories of Customers in the order in which each of those categories of Customers would be curtailed in an emergency.



(c) VENCorp must keep all Customers, including Transmission Customers, and must keep the Office of Gas Safety and the Minister informed of any changes made to the document made available under clause 6.4.3(b).

(ca) The obligation to inform referred to in clause 6.4.3(c) includes immediately informing the persons specified in that clause of any changes to the emergency curtailment list.

(d) VENCorp must at all times ensure that it does not release any information or document under this clause 6.4 which reveals the demand for or consumption of gas by any Customer.

(e) Notwithstanding clause 6.4.3(d) VENCorp shall, if required by the Minister or the Office of Gas Safety, disclose to the Minister or the Office of Gas Safety (as the case may be) any information and documents it has revealing the demand for or consumption of gas by any Customer if the Minister or the Office of Gas Safety certifies that such disclosure is required for any direction contemplated or given pursuant to section 207 of the Gas Industry Act or pursuant to sections 106 or 107 of the Gas Safety Act 1997 (Vic).

(f) For the avoidance of doubt, an emergency curtailment list may provide not only for the curtailment or interruption of the supply of gas but also may provide (either generally or in respect of specific Customers or areas) for the order, amount, duration and timing of that curtailment or interruption as well as for (either generally or in respect of specific Customers or areas) the order and timing of the ending of any curtailment or interruption including the order and timing in which Customers or areas shall receive gas and the amounts of gas they shall receive.



6.5 RESPONSE TO AN EMERGENCY

6.5.1 Declarations and directions in an emergency(a) When an emergency arises, VENCorp must:

(1) inform the Office of Gas Safety, if VENCorp reasonably anticipates that the emergency may have implications for safety;

(2) inform Participants, as soon as reasonably practicable, of the commencement, nature, extent and expected duration of the emergency and the way in which VENCorp reasonably anticipates it will act in response to the emergency; and

(3) keep Participants informed of any material changes in the nature, extent and expected duration of an emergency.

(b) Upon being informed of an emergency, each Participant must advise all relevant officers and staff (as defined in clause 6.3.3(b)) and, where relevant, its Customers, of the existence and nature of the emergency.

(c) During an emergency:(1) VENCorp may, subject to clause 6.6.4(a), issue such emergency directions as it

reasonably considers necessary:

(A) in accordance with the emergency procedures; and

(B) if the Minister and/or Office of Gas Safety direct or agree, other than in accordance with the emergency procedures; and

(2) each Participant must, subject to clause 6.5.1(e):

(A) comply with its safety plan (if any), safety procedures (if any), the emergency procedures applicable to the Participant in the circumstances, this chapter 6, and all emergency directions given by VENCorp;

(B) comply with the requirements of clauses 6.5.2 and 6.5.3 in relation to the injection and withdrawal of gas to and from the transmission system; and

(C) cooperate with VENCorp to enable VENCorp to implement the emergency procedures.

(d) Where relevant, a Participant must use its reasonable endeavours to ensure that during an emergency, its Customers act in a manner which enables that Participant to comply with all its obligations under this chapter 6.

(e) Where there is any conflict between:

(1) the requirements of a Participant’s safety procedures;

(2) the emergency procedures applicable to the Participant in the circumstances;

(3) this chapter 6; and

(4) an emergency direction given by VENCorp,

VENCorp must decide which of those requirements or part of those requirements is to prevail.



6.5.2 Injection controls(a) In an emergency, VENCorp may in its absolute discretion issue an emergency direction

requiring one or more Participants to:

(1) keep VENCorp informed of the maximum and minimum rates at which, and/or quantities in which, gas can be injected into the transmission system by the Participant at all relevant system injection points at such times or over such periods as VENCorp may specify; and

(2) take all steps available to the Participant to increase the maximum rates and/or quantities, or decrease the minimum rates and/or quantities, referred to in clause 6.5.2(a)(1), including but not limited to the deferral of maintenance or other works.

(b) In an emergency, each Participant must comply with all emergency directions given by VENCorp to inject gas into the transmission system in such quantities and at such rates as VENCorp may specify, within the minimum and maximum quantities or rates which are available to the Participant, irrespective of the commercial terms of those supplies, and irrespective of the quantities of gas being withdrawn from the transmission system by the Participant at that time.

(c) For a period of up to and including two years from the commencement date, VENCorp may make contractual arrangements with persons who are not Participants pursuant to which those persons will inject gas into the transmission system in an emergency, providing that the contract price of such gas must not exceed VoLL.

(d) Subject to clause 6.5.2(c), where VENCorp makes an arrangement under clause 6.5.2(c) with a person with whom a Participant has contracted to purchase gas, the following provisions apply to ensure that quantities of gas injected are treated as injected under that contract (insofar as those quantities of gas are capable of being treated as injected under that contract):

(1) VENCorp agrees that it enters into the arrangement with the non-Participant as agent of the Participant, but VENCorp will not be liable to the non-Participant under the contract;

(2) each Participant appoints VENCorp as agent for the purposes of this clause 6.5.2(d) and authorises VENCorp to notify the non-Participant of the appointment; and

(3) the amount which VENCorp is required to pay the non-Participant in respect of an injection called under this clause 6.5.2 is the greater of:

(A) the applicable market price during the trading intervals in which that non-Participant injected gas; and

(B) the amount payable by VENCorp to that non-Participant in respect of the gas it has injected in accordance with the contract.

(e) Subject to clause 6.5.2(c), to the extent that the market price applicable during any trading interval in which the non-Participant injected gas is lower than the amount payable by VENCorp to the non-Participant under the contract, the shortfall is to be paid to VENCorp by Market Participants who withdrew gas in those trading intervals as though the compensation panel has determined that compensation is payable to that non-Participant and the compensation payable is to be calculated in accordance with clause 3.6.6.



6.5.3 Withdrawal controls(a) In an emergency, VENCorp may in its absolute discretion issue an emergency direction

requiring one or more Participants to:

(1) keep VENCorp informed of the maximum and minimum rates at which, and/or quantities in which, gas can be withdrawn from the transmission system by the Participant at all relevant system withdrawal points at such times or over such periods as VENCorp may specify; and

(2) take all steps available to the Participant to increase the maximum rates and/or quantities, or decrease the minimum rates and/or quantities, referred to in clause 6.5.3(a)(1), including but not limited to the deferral of maintenance or other works.

(b) In an emergency, each Participant must comply with all emergency directions given by VENCorp to withdraw gas from the transmission system in such quantities and at such rates as VENCorp may specify, within the minimum and maximum quantities or rates which are available to the Participant, irrespective of the commercial terms of those supplies, and irrespective of the quantities of gas being injected into the transmission system by the Participant at that time.

(c) For a period of up to and including two years from the commencement date, VENCorp may make contractual arrangements with persons who are not Participants pursuant to which those persons will withdraw gas from the transmission system in an emergency, providing that the contract price of such gas must not exceed VoLL.

(d) Subject to clause 6.5.3(c), where VENCorp makes an arrangement under clause 6.5.3(c) with a person with whom a Participant has contracted to sell gas, the following provisions apply to ensure that quantities of gas withdrawn are treated as withdrawn under that contract (insofar as those quantities of gas are capable of being treated as withdrawn under that contract):

(1) VENCorp agrees that it enters into the arrangement with the non-Participant as agent of the Participant, but VENCorp will not be liable to the non-Participant under the contract;

(2) each Participant appoints VENCorp as agent for the purposes of this clause 6.5.3(d) and authorises VENCorp to notify the non-Participant of the appointment; and

(3) the amount which a non-Participant is required to pay VENCorp in respect of a withdrawal called under this clause 6.5.3 is the lower of:

(A) the applicable market price during the trading intervals in which that non-Participant withdrew gas; and

(B) the amount payable by that non-Participant in respect of the gas it has withdrawn in accordance with the contract.

(e) Subject to clause 6.5.3(c), to the extent that the market price applicable during any trading interval in which the non-Participant withdrew gas is greater than the amount payable for that gas by the non-Participant under the contract, the shortfall is to be paid to VENCorp by Market Participants who withdrew gas in those trading intervals as though the compensation panel has determined that compensation is payable to that non-Participant and the compensation payable is to be calculated in accordance with clause 3.6.6(b).



6.6 SYSTEM SECURITY THREAT

6.6.1 Notice of threat to system security(a) If VENCorp believes that a threat to system security is indicated either by:

(1) the planning reviews prepared by VENCorp under clause 5.2; or

(2) a preliminary operating schedule or final operating schedule prepared under clause 3.1.12; or

(3) any other fact or circumstance of which VENCorp becomes aware,

then it must provide to Participants without delay details of that threat to system security including VENCorp’s estimate of:

(4) the nature and general magnitude of the threat to system security, including an estimate of the likely duration of the threat to system security and the likely shortfall in gas supplies likely to occur during that period;

(5) the latest time VENCorp will need to intervene in the market if the threat to system security does not subside without intervention by VENCorp; and

(6) the system withdrawal zones within the transmission system in which the threat to system security is likely to be located.

(b) If VENCorp provides Participants with details under clause 6.6.1(a) regarding a threat to system security, VENCorp may issue a notice requiring each Participant to provide to VENCorp the Participant’s best estimates of the following:

(1) the ability of that Participant to reschedule planned outages of plant and equipment, including maintenance and other works, which would enable additional injections and/or withdrawals of gas to be made;

(2) the ability of that Participant to inject off-specification gas into the transmission system;

(3) the period of notice which that Participant will require before additional injections and withdrawals under clauses 6.6.1(b)(1) and (2) could be made; and

(4) the costs which that Participant will incur in facilitating or implementing an injection or withdrawal under clauses 6.6.1(b)(1) and (2).

(c) A Participant must not unreasonably withhold information required by VENCorp under a notice under clause 6.6.1(b) and must provide VENCorp with that information as soon as practicable after it has received a notice from VENCorp under clause 6.6.1(b).

(d) VENCorp must treat all information provided to it by a Participant under clause 6.6.1(b) as confidential information and may only use that information for the purpose of maintaining or re-establishing system security by issuing directions under clauses 6.6.3 and 6.6.4 or making a decision under clause 6.6.2.

(e) VENCorp must inform Participants immediately when it reasonably considers a threat to system security to be at an end.

6.6.2 Response to system security threat(a) If VENCorp has identified a threat to system security and reasonably considers that

sufficient time exists for the threat to subside without intervention, VENCorp must, in accordance with the procedures set out in clause 6.6.3, facilitate a market response to overcome the threat to system security.



(b) If VENCorp has identified a threat to system security and it does not believe that sufficient time exists for the threat to subside without intervention then VENCorp must take any measures it believes are reasonable and necessary to maintain or restore system security including those set out in clause 6.6.4.

6.6.3 Market response to threat to system security(a) If VENCorp believes that sufficient time exists for a threat to system security to subside

without intervention, VENCorp must:

(1) if it has not already done so, provide Participants with the information set out under clause 6.6.1(a);

(2) advise those Participants who VENCorp considers would be required to take action or cease taking action if the threat to system security is not resolved without intervention, including but not limited to any Market Participants whose inc/dec offers are likely to be scheduled in accordance with a preliminary schedule or final schedule, of the following information:

(A) the existence of the threat to system security; and

(B) the likely nature of any requirement of VENCorp if VENCorp determines that it should intervene;

(3) invite Market Participants to increase the quantity of gas they inject or decrease the quantity of gas they withdraw as specified in inc/dec offers submitted by such Market Participants in accordance with clause 3.1.5 in respect of that trading interval; and

(4) keep all Market Participants informed of significant changes to the information provided under this clause 6.6.3.

(b) Participants must comply with all requests and directions issued by VENCorp under this clause 6.6.

6.6.4 Intervention due to system security threat(a) If VENCorp believes that insufficient time exists for a threat to system security to subside

without intervention, VENCorp must intervene in the market by taking any measures it considers to be reasonable and necessary to overcome the threat to system security, including without limitation: (1) curtailment in accordance with the emergency curtailment list, subject to clause

6.6.4(b);

(2) injecting gas from VENCorp’s LNG reserve;

(3) increasing withdrawals;

(4) requiring any Participant to inject off-specification gas into the transmission system; and

(5) requiring Participants to do any reasonable act or thing which VENCorp believes necessary in the circumstances.

(b) In the event of a threat to system security which is attributable to a transmission constraint then to the extent practicable, VENCorp must, prior to curtailing any other Customers, use reasonable endeavours to curtail those Customers who, in VENCorp’s reasonable opinion, are using in excess of their authorised MDQ.


MSO Rules Amendments to facilitate site AMDQ credits:


Implementation of these amendments to the MSO Rules will take place on a date yet to be advised.


(b) In the event of a threat to system security which is attributable to a transmission constraint then to the extent practicable, VENCorp must, prior to curtailing any other Customers, use reasonable endeavours to curtail those Customers who, in VENCorp’s reasonable opinion, are using in excess of their the authorised MDQ or AMDQ credits assigned to those Customers.


6.6.5 Compensation of Market Participants in respect of intervention(a) Where:

(1) VENCorp requires a Market Participant to inject gas; and

(2) that Market Participant experiences a net auditable financial reduction as a direct result of making that injection,

then that Market Participant may claim compensation from VENCorp in respect of the injection.

(b) A Market Participant who wishes to make a claim under clause 6.6.5(a) must submit notice of its claim to VENCorp within fifteen business days of the day on which the Market Participant made the injection of gas referred to in clause 6.6.5(a).

(c) VENCorp must:

(1) within five business days of receiving a claim submitted in accordance with this clause, request the Adviser to establish a compensation panel to determine whether it is appropriate in all the circumstances for compensation to be paid and, if so, to determine an appropriate amount of compensation; and

(2) refer the claim to the Adviser for determination of those issues by the compensation panel.

(d) The Adviser must:

(1) within five business days of receiving a request from VENCorp, establish a compensation panel of three members from the group of persons referred to in clause 7.2.2; and

(2) be satisfied that the persons it chooses to comprise the compensation panel do not have any interests which could conflict with an impartial decision.

(e) Upon a referral from VENCorp pursuant to clause 6.6.5(c), the compensation panel must make a determination of the relevant issues and notify VENCorp of that determination as soon as practicable but in any event within twenty business days of the claim being referred to it.

(f) The compensation panel must:

(1) conduct itself on the same basis and in accordance with the same timeframes as a dispute resolution panel under clause 7.2.4;

(2) determine whether any compensation should be paid to the Market Participant to put the Market Participant in the position in which the Market Participant would have been, in respect of the gas injection it made under clause 6.6.5(a), had the direction not been issued by VENCorp; and

(3) base its determination on guidelines developed by VENCorp in consultation with Participants.



(g) If the compensation panel makes a determination that compensation should be paid to the Market Participant, VENCorp must compensate the Market Participant in accordance with the determination of the compensation panel and must advise the Market Participant as soon as practicable of the determination and of the date VENCorp intends to pay the Market Participant.”

(ga) VENCorp must pay interest on the amounts determined in accordance with clause 6.6.5 at the interest rate from the day following the date of the next payment of settlement amounts made under clause 3.6.7 following the determination of the compensation panel to the date when VENCorp actually pays the Market Participant the amount of the compensation determined. Interest is to be calculated on a daily basis and aggregated for the period.



6.7 FORCE MAJEURE AND MARKET SUSPENSION

6.7.1 Administered price capAfter consulting Market Participants, VENCorp must develop, authorise and publish and may from time to time in accordance with the public consultation procedures vary an administered price cap to be used as described in clauses 6.7.2 and 6.7.5.

6.7.2 Force majeure events(a) A force majeure event is the occurrence in a trading interval of any one or more of the

events or circumstances set out in clause 6.7.2(b) where VENCorp reasonably considers that:

(1) the event has resulted in a reduction in the normal capacity of part or all of the transmission system and/or the volume of gas which would otherwise normally flow in the transmission system during that trading interval; and

(2) that reduction is likely to materially affect the operation of the market or materially threaten system security.

(b) An event referred to in clause 6.7.2(a) is any of the following events:

(1) the Governor in Council by proclamation declares there to be an emergency under Part 9 of the Gas Industry Act, or any like or analogous event;

(2) the Office of Gas Safety issues a direction sections 106 or 107 of the Gas Safety Act 1997 (Vic) as the case may be, or any like or analogous event; or

(3) an event that is:

(A) neither anticipated nor controllable by Participants who are affected by the relevant event; and

(B) restricted to acts of nature, governmental interventions and acts of war,

or any like or analogous event.

(c) VENCorp must notify all Market Participants without delay of the occurrence of any force majeure event.

(d) Participants must use all reasonable endeavours to:

(1) ensure that they do not cause or exacerbate a force majeure event; and

(2) mitigate the occurrence and effects of a force majeure event.(e) If any force majeure event occurs then VENCorp must declare an administered price

period during which the price will be set by VENCorp in accordance with clause 3.2.2.

(f) Following a declaration by VENCorp of an administered price period in accordance with clause 6.7.2(e), the administered price period is to continue until VENCorp declares the force majeure event and the administered price period to be at an end and notifies all Market Participants accordingly.

6.7.3 Conditions for suspension of the market(a) Subject to clause 6.7.3(b), VENCorp may declare the market to be suspended when:

(1) a force majeure event occurs;

(2) an emergency occurs;

(3) VENCorp has been directed by a government authority to suspend the market or operate all or part of the transmission system in a manner contrary to the



provisions of these Rules following a proclamation declaring that Part 9 of the Gas Industry Act is to apply or following any similar proclamation or declaration under any like or analogous emergency laws.

(4) VENCorp determines that it is necessary to suspend the market because it has become impossible to operate the market in accordance with the provisions of these Rules or in accordance with the market objectives; and

(b) VENCorp must not suspend the market solely because:

(1) the market price has reached VoLL;

(2) VENCorp has issued an emergency direction; or

(3) VENCorp has intervened in the market due to a threat to system security under clause 6.6.

6.7.4 Declaration of market suspension(a) The market can only be suspended by a declaration by VENCorp under clause 6.7.3(a)

and if the market is suspended, VENCorp must notify all Participants without delay.

(b) Subject to clause 6.7.4(c), VENCorp must not declare the market to be suspended with retrospective effect.

(c) The market is to be deemed to be suspended at the start of the trading interval in which VENCorp makes a declaration that the market is suspended.

(d) Following a declaration by VENCorp under clause 6.7.3(a), the market is to remain suspended until VENCorp declares and notifies all Participants that market operation is to resume.

(e) A notification to Participants under clause 6.7.4(d) that market operation is to resume must include the time at which market operation is to resume.

(f) Notwithstanding a suspension of the market, VENCorp may issue emergency directions to Participants in accordance with clause 6.5; and

(g) If VENCorp declares that the market is suspended, market prices are to be set by VENCorp in accordance with clause 6.7.5.

6.7.5 Effect of market suspension(a) The market price during a trading interval for which VENCorp has declared the market to

be suspended is to be determined by VENCorp in accordance with clause 3.2.2.

(b) During a trading interval in which the market is suspended, these Rules will continue to apply with such modifications as VENCorp reasonably determines to be necessary, taking into consideration the circumstances and conditions giving rise to the decision by VENCorp to suspend the market.

6.7.6 Compensation due to the application of an administered price cap(a) Participants may claim compensation from VENCorp in respect of gas injected into the

transmission system if, due to the application of an administered price cap during either an administered price period or a period in which the market is suspended, the resultant market price payable to that Participant in any trading interval is less than the price specified in their injection inc/dec offer for that trading interval.

(b) Notification of an intent to make a claim under clause 6.7.6(a) must be submitted to VENCorp within two business days of notification by VENCorp that an administered price period has ended or that the market is no longer suspended.

(c) VENCorp must



(1) within five business days of receiving a claim submitted in accordance with this clause, request the Adviser to establish a compensation panel to determine whether it is appropriate in all the circumstances for compensation to be paid and, if so, to determine an appropriate amount of compensation; and

(2) refer the claim to the Adviser for determination of those issues by the compensation panel.

(d) The Adviser must:

(1) within five business days of receiving a request from VENCorp, establish a compensation panel of three members from the group of persons referred to in clause 7.2.2; and

(2) be satisfied that the persons it choses to comprise the compensation panel do not have any interests which could conflict with an impartial determination.

(e) Upon a referral from VENCorp pursuant to clause 6.7.6(c), the compensation panel must make a determination of the relevant issues and notify VENCorp of that determination as soon as practicable but in any event within twenty business days of the claim being referred to it.

(f) The compensation panel must:

(1) conduct itself on the same basis and in accordance with the same timeframes as a dispute resolution panel under clause 7.2.4;

(2) determine whether any compensation should be paid to the Market Participant to put the Market Participant in the position that the Market Participant would have been in, in respect of the gas injection referred to in clause 6.7.6(a), had the administered price cap not applied; and

(3) base its recommendations on guidelines developed by VENCorp in consultation with Participants.

(g) If the compensation panel makes a determination that compensation should be paid to the Market Participant, VENCorp must compensate the Market Participant in accordance with the determination of the compensation panel and must advise the Market Participant as soon as practicable of the determination and of the date VENCorp intends to pay the Market Participant.

(ga) VENCorp must pay interest on the amounts determined in accordance with clause 6.7.6 at the interest rate from the day following the date of the next payment of settlement amounts made under clause 3.6.7 following the determination of the compensation panel to the date when VENCorp actually pays the Market Participant the amount of the compensation determined. Interest is to be calculated on a daily basis and aggregated for the period.

6.7.7 Intervention reports(a) Within ten business days after one or more of the following events:

(1) an intervention in the market by VENCorp;

(2) an event which, in VENCorp’s reasonable opinion, is or may be a threat to system security;

(3) a force majeure event; or

(4) an emergency,

VENCorp must investigate the circumstances of that event and prepare a report to assess:



(5) the adequacy of the provisions of these Rules relevant to the event or events which occurred;

(6) the appropriateness of actions taken by VENCorp in relation to the event or events which occurred; and

(7) the costs incurred by VENCorp and/or Participants as a consequence of responding to the event or events.

(b) A copy of the report prepared under clause 6.7.7(a) must be provided to:





6.8 REVIEW OF CHAPTER 6

6.8.1 Timing of reviewVENCorp must, within:

(a) eighty business days of the third occurrence in any two year period of an event requiring VENCorp to direct the market to be suspended under clause 6.7.3; or

(b) five years from the commencement date,

whichever is the earlier, conduct a review of chapter 6 of these Rules in accordance with this clause 6.8.

6.8.2 Terms of referenceThe terms of reference for the review to be performed by VENCorp under this clause 6.8 are to be developed by VENCorp in consultation with the Regulator and must incorporate, but are not to be limited to, the adequacy and appropriateness of:

(a) the provisions of chapter 6; or

(b) any alternative provisions to those in chapter 6,

in satisfying and facilitating the achievement of the market objectives.

6.8.3 Process of reviewThe review performed by VENCorp under this clause 6.8 is to be conducted in accordance with the public consultation procedures.



6.9 EMERGENCY LEGISLATION

6.9.1 Gas Industry Act and other lawsFor the avoidance of doubt, nothing in clause 6 affects the application of Part 9 of the Gas Industry Act or any other like or analogous applicable emergency laws.



CHAPTER 7. ENFORCEMENT AND DISPUTES



7.1 ENFORCEMENT

7.1.1 Investigations(a) VENCorp may request a Participant to supply VENCorp with information relating to any

matter concerning these Rules in such form, covering such matters and within such reasonable time as VENCorp may request.

(b) If VENCorp makes a request for information under clause 7.1.1(a), it must provide to the Participant to whom the request is made the reasons for the request.

(c) Notwithstanding that a Participant may disagree with the reasons for the request provided by VENCorp under clause 7.1.1(b), a Participant must comply with a request made by VENCorp under clause 7.1.1(a).

(d) If a Participant fails to comply with a request by VENCorp for information under clause 7.1.1(a), VENCorp may appoint a person to investigate the matter and to prepare a report or such other documentation as VENCorp may determine.

(e) A Participant must assist the person to undertake the investigation and to prepare the report or other documentation under clause 7.1.1(d) and must, at the request of the person appointed, use its best endeavours to procure that third parties make available such information as the person may reasonably require.

(f) The cost of the investigation and of preparing the report or other documentation under clause 7.1.1(d) must be met by the Participant requested to supply the information under clause 7.1.1(a) unless VENCorp otherwise determines.

(g) Any report or other documentation referred to in this clause 7.1.1 may be used in any proceeding under or in relation to these Rules or for the purpose of commencing any such proceeding.

7.1.2 Procedures concerning alleged breaches of the Code(a) If VENCorp considers that:

(1) a Participant may have breached or may be breaching these Rules; and

(2) in the circumstances and if the breach is established, it would be appropriate that a sanction or sanctions be imposed on that Participant,

VENCorp must:

(3) notify the Participant of the alleged breach and details of the sanctions which may be imposed if the breach is established; and

(4) notwithstanding clause 5.4, notify the Regulator of the alleged breach and provide to the Regulator any information relevant to the alleged breach as is known to VENCorp.

(b) If the breach is of a nature that VENCorp may make a demand for payment under these Rules, VENCorp may make such demand.

(c) Notwithstanding a Participant’s right to bring to the attention of the Regulator directly any alleged breach of these Rules, if VENCorp receives written information from a Participant or any other person which alleges a breach of these Rules by a Participant, VENCorp must within five business days of receipt of the information:

(1) determine whether, based on that information, there would appear prima facie to be a breach of these Rules; and



(2) notify the person making the allegation as to whether VENCorp has referred or proposes to refer the matter to the Regulator.

7.1.3 Sanctions(a) The nature of sanctions which may be imposed under these Rules are set out in the Gas

Industry Act and any regulations made under the Gas Industry Act.(b) The classification of certain provisions of these Rules as civil penalty provisions is set out

in regulations made under the Gas Industry Act;(c) The classification of certain provisions of these Rules as:

(1) regulatory provisions; or

(2) conduct provisions,

is set out in schedule 7.1 and, in accordance with the Gas Industry Act, this classification is to be used to determine the sanction applicable to a breach of any such provision of these Rules.

7.1.4 Actions by agents, employees or officers of ParticipantsIf any partner, agent, officer or employee of a Participant does any act or refrains from doing any act which if done or not done (as the case may be) by a Participant would constitute a breach of these Rules, that act or omission is to be deemed for the purposes of this clause 7.1 to be the act or omission of the Participant.

7.1.5 Publication Subject to clause 5.4, VENCorp must publish a report at least once each year setting out a summary for the period covered by the report of all decisions made by VENCorp during that period in relation to enforcement of these Rules.



7.2 DISPUTE RESOLUTION

7.2.1 Application and guiding principles(a) Subject to clause 7.2.1(aa), the dispute resolution procedures set out in this clause 7.2

apply to all disputes which may arise between any of the following:

(1) VENCorp;

(2) Participants;

(3) Connection Applicants;

(4) responsible persons and persons who are able to satisfy VENCorp that they have a bona fide intention to become a responsible person; and

(5) persons who have been appointed by VENCorp under clause 4.4.20(b) as a metering database agent;

as to:

(6) the application or interpretation of these Rules; or

(7) a dispute under or in relation to a contract between two or more persons referred to in clauses 7.2.1(a)(1), (2), (3), (4) and (5) where that contract provides that the dispute resolution procedures under these Rules are to apply to any dispute under or in relation to that contract with respect to the application of these Rules; or

(8) the failure of a person referred to in clauses 7.2.1(a)(1), (2), (3), (4) or (5) to take action other than in accordance with these Rules; or

(9) a dispute concerning a proposed connection agreement; or

(10) the payment of moneys under or concerning any obligation under these Rules,

and for the avoidance of doubt, the dispute resolution procedures set out in this clause 7.2 apply to disputes between two or more persons from and within each of the categories set out in clauses 7.2.1(a)(1), (2), (3), (4) and (5).

(aa) In the case of a dispute:

(i) actually arising during any day of the period of an emergency declared by VENCorp; and

(ii) arising from the manner the emergency procedures are implemented during the period of that emergency

that dispute shall be resolved through the dispute resolution provisions written into the emergency procedures and not the dispute resolution procedures established in this clause 7.2.

(ab) For the avoidance of doubt, the dispute resolution procedure written into the emergency procedures is intended to resolve only those disputes arising during the implementation of the emergency procedures and then only as they may be related to the manner of that implementation and are not intended to resolve disputes arising as a consequence of that implementation action.

(b) Subject to clause 7.2.1(c), where a dispute of a kind set out in clause 7.2.1(a) arises, the parties concerned must comply with the procedures set out in clauses 7.2.3 to 7.2.13 before pursuing any other dispute resolution mechanism, including but not limited to court action in relation to the dispute.

(c) If the parties to a dispute cannot agree that:



(1) the matter in dispute is one to which any of the matters set out in clause 7.2.1(a) apply; and

(2) the matter in dispute would more appropriately be dealt with in accordance with the dispute resolution procedures under another regulatory instrument to which one or both parties are subject,

a party must apply in writing to the Regulator for a decision as to which dispute resolution procedures apply to the dispute and give notice to the other party.

(d) If the Regulator receives an application under clause 7.2.1(c), the Regulator must decide, within ten business days of receiving the application, whether the dispute would more appropriately be dealt with under dispute resolution procedures applicable under an applicable regulatory instrument other than these Rules and in making its decision, the Regulator must:

(1) decide whether the matter in dispute is relevant to any other applicable regulatory instrument including but not limited to the Access Code; and

(2) direct the parties to comply with the dispute resolution procedures under the Access Code if the matter in dispute is, in the reasonable opinion of the Regulator, a matter relating to access to services provided by a Participant to which the Access Code applies.

(e) If the Regulator receives an application under clause 7.2.1(c), but does not make a decision under clause 7.2.1(d) within ten business days of receiving the application, the determination of whether the dispute is one to which this clause 7.2 applies is to be made in accordance with the dispute resolution procedures set out in this clause 7.2.

(f) Subject to clause 7.2.1(d), the Regulator is not otherwise bound to require the parties to a dispute to adopt any dispute resolution process in favour of any other dispute resolution process.

(g) The parties must comply with a decision of the Regulator under clause 7.2.1(d) and the decision of the Regulator is final.

7.2.2 Appointment of Adviser and panel group(a) VENCorp must appoint a person from time to time to be the Adviser:

(1) for a term of three years (subject to clause 7.2.2(d)) and the Adviser is then eligible for reappointment;

(2) on such other terms and conditions as VENCorp may determine; and

(3) who must satisfy the criteria set out in clause 7.2.2(b).

(b) The Adviser must, in the reasonable opinion of VENCorp, not be a Participant or have a current material association, directly or indirectly, with a Participant.

(c) In appointing the Adviser, VENCorp must have regard to the extent to which the Adviser:(1) has a detailed understanding and experience of alternative dispute resolution

practice and procedures which do not involve litigation;

(2) has the capacity to determine the most appropriate alternative dispute resolution procedures in particular circumstances; and

(3) has an understanding of the gas industry.

(d) If the Adviser does not, in the reasonable opinion of VENCorp, continue to meet the requirement of clause 7.2.2(b), VENCorp may terminate the appointment of the Adviser and appoint a new Adviser.






7.2.2(d) is to be altered as follows:

(d) If the Adviser does not, in the reasonable opinion of VENCorp, continue to meet the requirements of clause 7.2.2(b) or clause 1.5.2(b) of the Retail Gas Market Rules, VENCorp may terminate the appointment of the Adviser and appoint a new Adviser.

(e) VENCorp, in consultation with the Adviser, must select at least seven persons to constitute the group from which a dispute resolution panel can be selected in accordance with clause 7.2.4(a)(2) and (3).

(f) Subject to clause 7.2.2(h), each person appointed to the group under clause 7.2.2(e):

(1) is appointed for one year and is then eligible for reappointment; and

(2) is appointed on such other terms and conditions as VENCorp determines.

(g) In appointing the group under clause 7.2.2(e), VENCorp and the Adviser must have regard to the extent to which the members of the group between them:

(1) have some understanding and experience of alternative dispute resolution practice and procedures which do not involve litigation; and

(2) have an understanding of the gas industry.

(h) VENCorp may change the composition of the group selected under clause 7.2.2(e) from time to time in consultation with the Adviser.

7.2.3 Dispute resolution process(a) Any of the parties involved in a dispute of a kind set out in clause 7.2.1(a) may refer the

dispute to the Adviser in accordance with clause 7.2.3(b).

(b) If a party wishes to refer a dispute to the Adviser under clause 7.2.3(a), that party must notify the Adviser and all other parties to the dispute of which the party is aware:

(1) of the existence of a dispute; and

(2) setting out a brief history of the dispute including:

(A) the names of the parties to the dispute;

(B) the grounds of the dispute; and

(C) the results of any previous dispute resolution processes undertaken pursuant to these Rules in respect of the dispute.

(c) If the Adviser receives notice of a dispute under clause 7.2.3(b), the Adviser must notify all other relevant parties of the dispute and may request from those other parties their own short written history of the dispute or any relevant associated written comments and if the Adviser requests such information from a party to the dispute, that information must be provided by that party within two business days.

(d) If a matter has been referred to the Adviser under clause 7.2.3(a), then before taking any action to resolve the dispute, the Adviser must be reasonably satisfied that the dispute is one to which clause 7.2.1(a) applies and must advise the parties in writing of its decision.



(e) If the Adviser is not satisfied that the dispute is one to which clause 7.2.1(a) applies, the procedures set out in clause 7.2.3(f) do not apply to the dispute.

(f) If the Adviser is satisfied that the dispute is one to which clause 7.2.1(a) applies, the Adviser must:

(1) appoint a dispute resolution panel in accordance with clause 7.2.4; and

(2) refer the dispute for resolution by the dispute resolution panel appointed under clause 7.2.4,

within five business days of receiving any information from the parties to the dispute under clause 7.2.3(c).

(g) Subject to all time limits specified in clause 7.2.3, nothing in this clause 7.2 precludes the Adviser from facilitating resolution of the dispute by agreement between the parties to the satisfaction of the parties without appointing or involving a dispute resolution panel.

7.2.4 The dispute resolution panel(a) Where the Adviser refers a dispute for resolution by a dispute resolution panel under

clause 7.2.3(f), the Adviser must:

(1) establish a dispute resolution panel consisting of three people chosen by the Adviser as appropriate in the particular circumstances of the dispute from the group of persons selected by the Adviser under clause 7.2.2(e) unless the Adviser reasonably considers the monetary amount to which the dispute relates is less than $100,000 in which case the Adviser may decide to appoint one person to constitute the dispute resolution panel from the group of persons selected by the Adviser under clause 7.2.2(e);

(2) be satisfied that the persons chosen to comprise the dispute resolution panel do not have any interests which could conflict with an impartial resolution of the dispute; and

(3) nominate one of the members of the dispute resolution panel to be the chairperson.

(b) A person who has previously served on a dispute resolution panel is not precluded from being appointed to another dispute resolution panel established in accordance with clause 7.2.4(a).

(c) When a matter is referred to a dispute resolution panel under clause 7.2.3(f)(2), the dispute resolution panel must select the form of, and procedures to apply to, the dispute resolution process which:

(1) the dispute resolution panel considers appropriate in the circumstances; and

(2) must accord with the following principles:

(A) be simple, quick and inexpensive;

(B) take account of the skills and knowledge required for the relevant dispute;

(C) observe the rules of natural justice; and

(D) encourage resolution of disputes without formal legal representation or reliance on legal procedures.

(d) The dispute resolution process will take place at a venue determined by the dispute resolution panel in consultation with the parties and may include either party's premises or any other premises.



(e) Subject to clause 7.2.10(c) the parties must comply with any procedural requirements imposed by the dispute resolution panel in the determination of the dispute including a requirement to exchange submissions, documents and information.

(f) Subject to clause 7.2.4(g), the dispute resolution panel must ensure that the dispute resolution process is completed and that the dispute resolution panel has given notice of its determination of the dispute as soon as practicable but in any event within twenty business days of the dispute being referred to the dispute resolution panel (or such longer period as the Adviser may permit following a request by the dispute resolution panel for an extension of time).

(g) Within ten business days of receiving notification from the dispute resolution panel of their determination of the dispute, the parties must provide written notice to the dispute resolution panel describing all action taken in accordance with the resolution or determination of the dispute resolution panel.

7.2.5 Disputes about paymentIf a dispute arises:

(a) in relation to an obligation to pay moneys owing under these Rules; or

(b) which affects an obligation to pay moneys under these Rules,

then:

(c) the dispute must be referred to the Adviser in accordance with clause 7.2.3(a), or to the Regulator under clause 7.2.1(c), within twelve months of the dispute arising;

(d) the Adviser must notify all Participants who may be affected by the resolution of the dispute, including but not limited to Participants whose settlement statement may be amended as a consequence of the resolution of the dispute; and

(e) those moneys must be paid without prejudice on the date specified for payment in the relevant settlement statement, notwithstanding a dispute regarding the amount.

7.2.6 Disputes affecting settlement statementsWhere an amount stated to be payable in a settlement statement issued under clause 3.6.15 is the subject of a dispute and the resolution of the dispute affects the amount payable, then:

(a) when the dispute is resolved in accordance with this clause 7.2, VENCorp must issue a revised settlement statement to replace each settlement statement affected by the resolution of the dispute, in accordance with clause 3.6.19; and

(b) the amount specified in a revised settlement statement must be paid by the relevant Participant, whether or not that Participant is a party to the dispute, on the date specified in the revised settlement statement.



7.2.7 Legal representationLegal representation before the dispute resolution panel may be permitted by the dispute resolution panel where the dispute resolution panel considers it appropriate or desirable.

7.2.8 Cost of dispute resolutionThe reasonable costs of the parties to the dispute may be allocated by the dispute resolution panel for payment by one or more parties as part of any determination.

7.2.9 Effect of resolution(a) A determination of the dispute resolution panel is binding on the parties to the dispute

including without limitation any provision of the resolution or determination relating to the payment of moneys by any of the parties and any provision as to the performance of actions by any of the parties.

(b) A requirement that a party to the dispute pay moneys under:

(1) an agreement reached between the parties to a dispute under clause 7.2.3(g); or

(2) a determination of the dispute resolution panel,is an obligation under these Rules to pay those moneys.

(c) If a determination of the dispute resolution panel applies to a person referred to in clauses 7.2.1(a)(1), (2), (3), (4) and (5), that person must comply with the determination of the dispute resolution panel to the extent that the determination applies to that person, notwithstanding that the person was not a party to the dispute.

7.2.10 Recording and publication(a) When a dispute resolution panel resolves a dispute, the chairperson of the dispute

resolution panel must send written details of the resolution of the dispute to the Adviser as soon as practicable.

(b) The Adviser must produce a summary of the resolution of each dispute without identifying the parties, and forward these to VENCorp and the parties to the dispute.

(c) Claims for confidentiality of information disclosed in the dispute resolution process must be dealt with in accordance with the provisions relating to use of information in clause 5.4.

(d) At least twice in each year, VENCorp must make available to all persons referred to in clauses 7.2.1(a)(1), (2), (3), (4) and (5) the results of dispute resolutions under this clause 7.2 which have been settled since the previous results were made available under this clause 7.2.10(d), including the relevant determinations of the dispute resolution panel.

7.2.11 Judicial reviewThe parties to a dispute may refer any question of law which may arise in respect of the resolution of a dispute for determination by a court of competent jurisdiction.

7.2.12 Limitation of liabilityTo the extent permitted by law, the Adviser, the dispute resolution panel and its members are not to be liable for any loss or damage suffered or incurred by a Participant or any other person as a consequence of any act or omission of those persons unless the Adviser, the dispute resolution panel, or its members, as the case may be, acted otherwise than in good faith under this clause 7.2.

7.2.13 Indemnity



Notwithstanding clause 7.2.12, if the Adviser or a member of the dispute resolution panel is liable to pay any amount for loss or damage suffered or incurred by a person referred to in clauses 7.2.1(a)(1), (2), (3), (4) and (5) or any other person as a consequence of any act or omission of those persons, VENCorp must indemnify that person:

(a) for the full amount; and

(b) for any costs and expenses incurred by that person in defending related proceedings,

unless the liability arose out of conduct involving a lack of good faith.



BACKGROUND NOTETO SCHEDULE 7.1

CLASSIFICATION OF RULESThe following Background Note is included for information purposes only - it does not form part of these Rules. It is intended to provide a general indication of the basis on which the classification of these Rules has been made, and a guide, only, for the classification of future new Rules.

Schedule 7.1 is a table which contains the classification of these Rules, set out after this Background Note. It is part of these Rules and any change, addition or deletion to that table must be made in accordance with the Rule change procedures in chapter 8.

The Gas Industry ActThe Gas Industry Act provides for a three-way classification of provisions of these Rules into:

civil penalty provisions;

conduct provisions;

regulatory provisions.

The classification of certain Rules as civil penalty provisions is effected by the Gas Industry (MSO Rules) Regulations 1999.The Gas Industry Act provides that the classification of other Rules as conduct provisions and regulatory provisions is to be made in these Rules. Schedule 7.1 sets out that classification.

The table below summarises the information contained in this Background Note.

Classification of Rules Who can bring action Nature of sanction(imposed by a court)

Civil Penalty Provisions(as classified by regulations)

ACCC penalties

Regulatory Provisions(as classified in Rules - Schedule 7.1)

ACCC injunction

declaration

Conduct Provisions(as classified in Rules - Schedule 7.1)

Any person damages

injunction

declaration

Provisions requiring classificationThose provisions of these Rules which impose an obligation on a person have been classified. Where a provision of these Rules allows a discretion on the relevant person as to whether or not to do something, that provision has not been classified, as it will not be a breach of that provision if the person decides not to perform in accordance with that provision.

Civil penalty provisionsCivil penalty provisions are provisions the breach of which is regarded as most serious. Generally, they are provisions which must be complied with in order to ensure that the market and these Rules work properly.

Civil penalty provisions are enforceable only by the Regulator, who may bring proceedings for the levy of a civil penalty, i.e. a fine for an offence provable on the balance of probabilities, payable to the Consolidated Fund. Any person can advise the Regulator of an alleged breach of a civil penalty provision, although it is up to the Regulator to take the matter further. Clause 7.1.2 of these Rules also provides a mechanism by



which VENCorp, on its own account or on the advice of a Participant, can decide to bring an alleged breach to the attention of the Regulator.Conduct provisionsA conduct provision is a provision involving an obligation to be performed by a person where the consequences of a breach are less serious than for a civil penalty provision. Most provisions of these Rules that are not of an administrative nature or are to be performed by VENCorp will be classified as conduct provisions. However, generally, an obligation to pay money, including one imposed on VENCorp, will be classified as a conduct provision.

Conduct provisions are enforceable by any person by bringing injunction proceedings. In addition, anyone who suffers loss or damage by conduct in contravention of a conduct provision will also have a statutory right to recover the loss or damage in a civil action against the person whose breach of these Rules caused it. However, the Gas Industry Act and these Rules make it clear that this right is subject to the dispute resolution procedures in clause 7.2, which require a Participant to take any action relating to these Rules in accordance with those dispute resolution procedures, before resorting to other formal legal recourse (such as the courts). Finally, the Supreme Court is vested with jurisdiction to declare, on the application of any interested party, that a person is in breach of a conduct provision.

Regulatory provisionsRegulatory provisions generally fall into two main categories:

1. obligations to be performed by VENCorp (other than obligations to pay money, which will be classified as conduct provisions); and

2. obligations of an administrative nature.

The injunction remedy will be available for breaches of regulatory provisions, on application by the Regulator. It is possible for the Supreme Court to declare that a person is in breach of a regulatory provision, on application by the Regulator. There will be no statutory right to damages.

Rules may be in two categoriesA civil penalty provision may be a conduct provision or a regulatory provision as well, but conduct provisions and regulatory provisions are mutually exclusive.



SCHEDULE 7.1 CLASSIFICATION OF RULES

The table below sets out the classification of Rules as:

1. conduct provisions; and

2. regulatory provisions.

This table, which forms Schedule 7.1, is part of these Rules. Changes to this table must be made in accordance with chapter 8.

CLASSIFICATION OF RULESRule Classification*

1. INTRODUCTION

1.1 Purpose and application of Rules1.1.5 Persons who must register with VENCorp. RP

1.2 VENCorp1.2.1(a) Operation of transmission system and market by

VENCorp.RP

1.2.1(b) Maintenance and publication of register of Participants by VENCorp.

RP

1.2.1(c) Development and update of system security guidelines by VENCorp.

RP

1.2.1(e) VENCorp must monitor trading activity. RP

1.2.1(f) VENCorp must prepare report of significant price variations.

RP

1.2.1(g) Availability of report prepared by VENCorp. RP

1.2.1(h) VENCorp must develop and publish guidelines. RP

1.2.1(i) Considerations VENCorp must take into account in developing procedures.

RP

1.2.1(j) Compliance with Rules by VENCorp. RP

1.2.4(c) Standard of performance by VENCorp. RP

1.2.4(e) Publication of performance indicators by VENCorp. RP

1.3 Enforceability and Amendment of these Rules1.3.1 Rules enforceable in accordance with chapter 7. RP

1.3.2 Amendments to be in accordance with chapter 8. RP

* CP = conduct provision (any person can bring action) - damages/declaration/injunction

RP = regulatory provision (Regulator, only, can bring action) - injunction/declaration



1.4 Public Consultation Procedures1.4 Development and minimum requirements of public

consultation procedures.RP

2. REGISTRATION

2.1 Registration with VENCorp2.1(a), (b) Persons who must be registered as a Participant with

VENCorp.CP

2.1(d) A person may not participate in the market in a category of Market Participant unless the person is registered in that category.

CP

2.1(e) Eligibility requirements/Notice by Participant if it ceases to be eligible.

CP

2.1(f) Form of application. RP

2.1(h) VENCorp may require applicant to pay costs associated with a review of additional information.

CP

2.1(i) Approval of application and registration by VENCorp. RP

2.1(j) Notice of approval of application by VENCorp. RP

2.1(k) Notice that application not approved by VENCorp. RP

2.2 Ceasing to be a Participant2.2(c) VENCorp must notify all Participants of cessation by a

Participant.RP

2.2(d) If VENCorp notifies Participants of cessation of registration, Market Participant must cease activities in the market.

CP

2.5 Intending Participants2.5(b) Form of application and payment of fee (if any). CP

2.6 Market Fees2.6(a) Participants must pay market fees. CP

2.6(c) Description of components of market fees payable by Participants.

CP

2.6(d) VENCorp must produce initial budget report and conduct presentation for next financial year.

RP



2.6(e) Availability and publishing report. RP

2.6(f) VENCorp must invite submissions. RP

2.6(g) VENCorp must prepare a final report. RP



2.6(h) VENCorp to provide final report to Regulator. RP

2.7 Previous Financial Year Report2.7(a) VENCorp must produce report for previous financial year

containing certain matters.RP

2.7(b) Availability of report. RP

3. MARKET OPERATION AND ADMINISTRATION

3.1 Nominations, Gas Scheduling and Market Operations3.1.1 Operation and scheduling of gas by VENCorp. RP

3.1.2 Submission of nominations and optional inc/dec offers by Market Participants

CP

3.1.3(a) Submission by Market Participants of a separate injection nomination for each system injection point .

CP

3.1.3(b) Information which must be included in an injection nomination.

CP

3.1.4(a) Submission by Market Participants of separate withdrawal nomination for each system withdrawal zone.

CP

3.1.4(b) Information which must be included in a withdrawal nomination.

CP

3.1.5(g) Market Participants must not submit inc/dec offers without VENCorp permission.

CP

3.1.7(a), (b), (c), (d)

Timing of nominations.

CP

3.1.9(a) Market Participants responsible for verifying information posted on market information bulletin board correct.

CP

3.1.9(c) VENCorp must acknowledge receipt of inc/dec offers, nominations and EoD linepack bids.

RP

3.1.9(d) VENCorp must use information on market information bulletin board for scheduling.

RP

3.1.9(e) If a nomination, inc/dec offer or EoD linepack bid is invalid, VENCorp must not schedule it, but must notify Market Participant.

RP



3.1.10(a) Market Participants must submit nominations, inc/dec offers and EoD linepack bids in accordance with electronic communications procedures.

CP

3.1.10(e) Variations and revocations of standing nominations and standing inc/dec offers must be made in accordance with the electronic communication procedures.

CP



3.1.10(f) Market Participants’ warranties. CP

3.1.10(h) Notification by Market Participant of inability to comply with final nomination.

CP

3.1.11 Application by VENCorp of principles to schedule equal priced inc/dec offers.

RP

3.1.12(a) Inputs and assumptions to be used by VENCorp for producing preliminary operating schedules and final operating schedules.

RP

3.1.12(b) VENCorp must apply the inputs and assumptions in an optimisation program to produce preliminary operating schedule and final operating schedule.

RP

3.1.12(c) Publication of preliminary operating schedules and final operating schedules.

RP

3.1.12(d) VENCorp must publish a revised preliminary operating schedule or final operating schedule if there is a material change to circumstances.

RP

3.1.12(e) Each preliminary operating schedule and final operating schedule must include information in clause 5.1.4(b).

RP

3.1.12(f) All material factors taken into account by VENCorp in producing a preliminary operating schedule or final operating schedule must be recorded.

RP

3.1.12(g) VENCorp must maintain records relating to the scheduling process.

RP

3.1.12(h) VENCorp must issue scheduling instructions by 9am each day.

RP

3.1.12(i) VENCorp may issue further scheduling instructions in accordance with the gas scheduling procedures.

RP

3.1.12(j) VENCorp must log or record scheduling instructions. RP

3.1.13(a) Market Participant must comply with scheduling instruction (subject to clause 3.1.13(b) and (d)).

CP

3.1.13(b) Notification by Market Participant of inability to comply with scheduled inc/dec offer.

CP



3.1.13(c) Notification by VENCorp if Market Participant unable to comply with scheduling instruction.

RP

3.1.13(e) VENCorp may declare non-conforming if Market Participant fails to comply with scheduling instructions, (subject to 3.1.13(b) and (d)).

RP

3.1.13(f) Notification by VENCorp that injections/withdrawals do not conform, (and if certain matters satisfied, VENCorp may intervene).

RP



3.1.15(a) Storage Providers and Producers must verify quantities of gas intended to be injected into and withdrawn from the transmission system.

CP

3.1.15(b) Storage Providers and Producers must notify VENCorp of a material change to the quantity of gas intended to be injected or withdrawn.

CP

3.1.16(b) VENCorp must establish rules for determining ownership of gas in the transmission system.

RP

3.1.16(c) VENCorp must resolve any dispute relating to ownership of gas in the transmission system.

RP

3.1.16(d) Warranties by Market Participants to VENCorp relating to title of gas.

CP

3.1.16(e) Unconditional and irrevocable authorisation by each Market Participant to VENCorp to effect transfers of title to gas.

CP

3.1.16(f) Indemnification by Market Participants of VENCorp against loss, liability, damage, claim, etc for breach of warranties in clause 3.1.16(d).

CP

3.2 Determination of market price3.2.1(a) Determination of market price by VENCorp RP

3.2.1(b) VENCorp must produce a pricing schedule at the end of each gas day.

RP

3.2.1(c) Inputs to be used by VENCorp in producing pricing schedule.

RP

3.2.1(e) Inputs and assumptions to be applied by VENCorp in an optimisation program to produce pricing schedule.

RP

3.2.1(g) VENCorp must publish the market price. RP

3.2.2 Obligations of VENCorp to set market price if force majeure event or market suspension.

RP



3.2.3 Obligations of VENCorp to set market price if no force majeure event and/or no market suspension.

RP

3.2.4(c) VENCorp must conduct regular reviews of the value of VoLL

RP

3.2.4(d) VENCorp must conduct a review of the value of VoLL every two years.

RP

3.3 Participant Compensation Fund3.3.1 Establishment and maintenance of the participant

compensation fund by VENCorp.RP



3.3.2(a) Collection by VENCorp of amount from Market Participants and payment by Market Participants of contribution to participant compensation fund.

CP

3.3.2(c) Variation and review of funding requirement by VENCorp.

RP

3.3.2(d) VENCorp to determine contribution rate of participant compensation fund.

RP

3.3.2(e) VENCorp must publish funding requirement for participant compensation fund.

RP

3.3.2(f) Payment by Market Participants of a proportion of the funding requirement.

CP

3.3.2(g) Component of settlement amount payable by Market Participants must be paid into participant compensation fund.

CP

3.3.2(i) Maintenance of fund by VENCorp. RP

3.3.2(k) Payment of tax on interest, fees and compensation payments by VENCorp.

CP

3.4 Linepack and settlement linepack3.4.2(b), (c), (d)

VENCorp must allocate EoD linepack.

RP

3.4.2(e), (f), (g)

Determination of price of EoD linepack.

RP

3.4.2(h) Notification by VENCorp of EoD linepack allocation and price.

RP

3.4.4(a) VENCorp must determine linepack capacity to be made available to Market Participants applicable on commencement date and publish allocations.

RP





3.4.4(b) If there is a material change in EoD linepack capacity, VENCorp must determine and publish the amount of new EoD linepack capacity.

RP

3.5 Allocation and Reconciliation3.5.2(a) Market Participants must appoint Allocation Agents at

injection points.CP

3.5.2(b) Market Participants must not submit nomination unless conditions satisfied.

CP

3.5.2(c) Only one Allocation Agent shall be appointed for each system injection point.

CP

3.5.2(d) Notification by Market Participant if Allocation Agent ceases to be approved.

CP

3.5.2(e) Market Participant must ensure Allocation Agent complies with clause 3.5.

CP

3.5.2(g) Allocation Agents must give statement to VENCorp. CP

3.5.2(h) Amount of total quantity of gas allocated by each Allocation Agent must equal total gas injected.

CP

3.5.2(l) VENCorp must determine quantities of gas which are to be treated as injected.

RP

3.5.2(m) VENCorp must determine quantities of gas treated as injected according to formula.

RP

3.5.3(a) Market Participant must appoint an Allocation Agent at non-SAW points.

.......................

CP




---- 3.5.3(a) to be altered as follows:

3.5.3(a) Market Participant must appoint an Allocation Agent at delivery points.

CP

3.5.3(b) Market Participant must not submit nominations unless Allocation Agent appointed and confirmed to VENCorp.

CP





3.5.3(c) Only one Allocation Agent shall be appointed for each non-SAW point.

........................

CP




---- 3.5.3(c) to be altered as follows:

3.5.3(c) Only one Allocation Agent shall be appointed for each non-SAW delivery point.

CP

3.5.3(d) Notification by Market Participant if Allocation Agent ceases to be appointed by it.

CP

3.5.3(e) Market Participant must ensure Allocation Agent complies with clause 3.5.

CP

3.5.3(g) Allocation Agents must provide statement to VENCorp. CP

3.5.3(h) Amount of gas allocated by Allocation Agent must equal total quantity withdrawn.

CP

3.5.3(l) VENCorp must determine quantities of gas to be treated as withdrawn, if no Allocation Agent.

RP

3.5.3(m) VENCorp must determine quantity of gas treated as withdrawn according to formula.

RP

3.5.4 VENCorp must establish allocation algorithm, give copy to Market Participants, review the allocation algorithm.

....................

RP




---- reference to 3.5.4 to be deleted without replacement





3.5.5(a)-(f) Establishment and review of reconciliation procedures by VENCorp, consultation with Market Participants, provision of copies.

.......................

RP




---- reference to 3.5.5(a)-(f) to be deleted without replacement

3.5.5(g) Market Participants must comply with reconciliation procedures.

.....................

CP




---- reference to 3.5.5(g) to be deleted without replacement

3.6 Settlements3.6.1(a) VENCorp must determine market fees and facilitate

billing and settlement of transactions by VENCorp.RP

3.6.1(b) Market Participants must pay market fees. CP

3.6.2(a) VENCorp must ensure EFT facility is provided. RP

3.6.2(b) Market Participants must use the EFT facility. CP

3.6.3 VENCorp must determine trading amounts for each Market Participant.

RP

3.6.4 Method by which the trading imbalance of a Market Participant shall be calculated.

RP

3.6.5 VENCorp must determine settlement amounts for each Market Participant in accordance with this clause.

RP

3.6.6(a) Payment by Market Participants of amount determined in accordance with clause 3.6.6(b).

CP



3.6.6(b) VENCorp must determine amount of compensation payments payable by Market Participants in accordance with this clause.

RP



3.6.6(d) Inclusion of amounts and details by VENCorp in settlement statement.

RP

3.6.7 VENCorp to determine and pay ancillary payments in accordance with clause 3.6.7.

CP

3.6.8(a) VENCorp must establish and publish procedures for determining uplift payments in consultation with Transmission Pipeline Owners and Market Participants.

RP

3.6.8(aa) VENCorp may modify uplift payment procedures in consultation with Transmission Pipeline Owners and Market Participants

RP

3.6.8(c) A Retailer who sells gas to Customers must pay uplift payments in respect of withdrawals of gas by those Customers.

CP

3.6.8(da) Transmission Pipeline Owners must pay uplift payments. CP

3.6.8(db) Market Participants must pay uplift payments in excess of the uplift payments obligations placed on Transmission Pipeline Owners under their respective service envelope agreements.

CP

3.6.8(e) VENCorp must publish details of ancillary payments due. RP

3.6.8(f) If VENCorp determines ancillary payments are attributable to transmission constraints, VENCorp must determine and publish certain information relating to the transmission constraint.

RP

3.6.9 Determination by VENCorp of EoD linepack credits and EoD linepack debits.

RP

3.6.10(a) VENCorp must maintain a linepack account. RP

3.6.10(b) VENCorp must record linepack credits and linepack debits in linepack account.

RP

3.6.10(c) Formula for VENCorp to determine the amount of any linepack credit or linepack debit.

RP

3.6.11 VENCorp must establish, document and make available to Market Participants procedures for review of the linepack account.

RP

3.6.12(a) VENCorp must clear the balance of the linepack account each month.

RP



3.6.12(b) Payments by Market Participants. CP

3.6.12(c) Payments by VENCorp to Market Participants. CP

3.6.13(a) Payment of settlement amounts by Market Participants. CP

3.6.13(b) Payment of settlement amounts by VENCorp. CP



3.6.14(a) Provision of preliminary statement by VENCorp. RP

3.6.14(c)

Notification of errors in preliminary statements by Market Participants;

review of preliminary statement by VENCorp.RP

3.6.14(d) Notification and correction by VENCorp of errors in preliminary statements.

CP

3.6.15 Provision of final statements by VENCorp. RP

3.6.16 Payment by Market Participants of settlement amounts. CP

3.6.17 Payment by VENCorp of settlement amounts. CP

3.6.18 Settlement disputes must be resolved in accordance with the dispute resolution procedures.

RP

3.6.19 VENCorp must issue revised statements. CP

3.6.20(a) VENCorp must specify time by which and date on which payment under a revised statement is due.

RP

3.6.20(b) Payment by Market Participants of the revised amount payable.

CP

3.6.20(c) Payment by VENCorp of the revised amount payable. CP

3.6.23(a) Payment of interest by VENCorp and Market Participants.

CP

3.7 Prudential Requirements

3.7.2(a) Provision and maintenance of security by Market Participants.

CP

3.7.3 The form of security which must be provided by a Market Participant.

CP

3.7.4(a) VENCorp must determine and confirm each Market Participant’s minimum exposure.

RP

3.7.4(c) Market Participants must procure that at all times security held by VENCorp is not less than their minimum exposure.

CP

3.7.5(a) Provision of replacement security by Market Participant. CP





3.7.5(b) If Market Participant fails to comply, VENCorp must give an Market Participant a suspension notice.

RP

3.7.6(a) VENCorp must notify Market Participant if it exercises rights in accordance with clause 3.6.21 (issue of default notice).

RP

3.7.6(b) Market Participant must provide additional security. CP

3.7.6(c) VENCorp must give Market Participant a suspension notice if it fails to comply.

RP

3.7.7(a), (b), (c)

Publication of suspension notices and revocation by VENCorp.

RP

3.7.7(e) Market Participants must comply with suspension notices.

CP

3.7.7(g) Publication of notices by VENCorp. RP

3.7.7(h) VENCorp must deregister suspended Market Participants where incapable of rectifying default event or failure.

RP

3.7.8 Setting of trading limits by VENCorp. RP

3.7.9 Monitoring of exposures by VENCorp and notification by VENCorp.

RP

3.7.10(a) Making of margin calls by VENCorp. RP

3.7.10(b) Satisfaction of margin calls by Market Participants. CP

3.7.10(e) VENCorp must give Market Participant a suspension notice if Market Participant fails to satisfy a margin call.

RP

3.7.11 Information to be treated as confidential by VENCorp. RP

3.8 VENCorp to apply GST CP

4. TECHNICAL MATTERS4.1 Connection to the Transmission System

4.1.3 Obligations of Transmission Pipeline Owner. CP

4.1.4 Obligations of VENCorp. RP

4.1.5 Obligations of Connected Parties. CP

4.1.6(d) VENCorp must determine application fee for connection. RP

4.1.7(a) Submission of information by Transmission Pipeline Owner to VENCorp.

CP





4.1.7(b) & (d)VENCorp obligations in relation to approval/rejection of connection.

RP

4.1.7(e) Provision of information by Transmission Pipeline Owner and Connection Applicant.

CP

4.1.7(f) VENCorp must determine connection principles and procedures and incorporate into these Rules.

RP

4.1.7(g) VENCorp must publish connection guidelines. RP

4.1.8(a) Transmission Pipeline Owner must prepare and make offer to connect.

CP

4.1.8(b) The offer to connect must contain the proposed terms and conditions for connection to the transmission system.

CP

4.1.8(c) Offer to connect must satisfy certain conditions. CP

4.1.8(d) Transmission Pipeline Owner must use reasonable endeavours to provide an offer in accordance with certain requirements.

CP

4.1.8(e) Conduct of negotiations between Transmission Pipeline Owner and Connection Applicant must be in good faith.

CP

4.1.8(f) Offer to connect must define the basis for determining charges.

CP

4.1.9(a) Obligations of Connection Applicant if Connection Applicant accepts offer.

CP

4.1.9(c) Connection agreement must be based on the offer to connect.

CP

4.1.10(a) Connection agreement must not be entered unless approved by VENCorp.

CP

4.1.10(b) Submission of connection agreement by Transmission Pipeline Owner to VENCorp.

CP

4.1.10(c) Provision of information by Transmission Pipeline Owner to VENCorp.

CP

4.1.10(d) Approval or rejection of connection agreement by VENCorp within ten business days.

RP

4.1.10(f) Provision of information by Transmission Pipeline Owner and Connection Applicant.

CP

4.1.11 Transmission Pipeline Owner must consult with VENCorp in relation to proposed connection.

CP





4.1.12(a)

Information must be prepared, given and used in good faith.

Information must be treated as confidential and protected from disclosure.

CP

4.1.12(b) Notification of change to information by Transmission Pipeline Owner/Connection Applicant.

CP

4.1.13 Interconnecting Pipeline Owner must enter into connection agreement.

CP

4.2 LNG Storage4.2.2(a) VENCorp is responsible for scheduling of LNG injection

offers and managing LNG reserve.RP

4.2.2(b) VENCorp must establish committee to review VENCorp’s entitlement to LNG reserve.

RP

4.2.3 Obligations of the LNG Storage Provider. CP

4.2.4(a), (b) Provision of information by LNG Storage Provider to VENCorp in relation to BOC Agreement.

CP

4.2.4(d) LNG Storage Provider must not terminate/vary BOC Agreement without consent of VENCorp.

CP

4.2.5(a) VENCorp must not adversely affect BOC’s LNG storage entitlement.

RP

4.2.5(b) Provision of LNG storage capacity by LNG Storage Provider.

CP

4.2.5(c) LNG storage capacity must be made available to VENCorp.

CP

4.2.5(d) Market Participant must hold LNG storage capacity in order to use LNG storage facility.

CP

4.2.5(e) LNG Storage Provider must maintain register. CP

4.2.6(b) Market Participant may not transfer LNG storage/stock under certain conditions.

CP

4.2.6(d) LNG Storage Provider must not reject transfer which satisfies requirements.

CP

4.2.6(e), (f) Notification of proposed LNG storage transfer by transferor and transferee.

CP





4.2.6(g) Registration of LNG storage transfer by LNG Storage Provider and notification to VENCorp.

CP

4.2.6(j) Registration by LNG Storage Provider of cessation of entitlement to LNG storage capacity.

CP

4.2.7(a) LNG Storage Provider must order maximum quantity of gas.

CP

4.2.7(c) Determination of quantity of gas by LNG Storage Provider and notification to VENCorp.

CP

4.2.8(a) Market Participants must submit LNG injection offers. CP

4.2.8(b)-(d) VENCorp’s obligations in relation to the acceptance and scheduling of LNG injection offers.

RP

4.2.9(a) VENCorp may utilise LNG Reserve in accordance with this clause.

RP

4.2.9(b) Compliance by LNG Storage Provider with VENCorp directions.

CP

4.2.9(c) Review of LNG Reserve by VENCorp. RP

4.2.9(d) Consultation by VENCorp with Market Participants and LNG Storage Provider for the purpose of carrying out review of LNG reserve.

RP

4.2.9(e) Action which must be taken by LNG Storage Provider and Market Participants.

CP

4.2.10(a) Establishment and operation of information exchange system by LNG Storage Provider and VENCorp.

RP

4.2.10(d) Provision of information referred to in clause 4.2.7(d) by VENCorp on request.

RP

4.3 Gas Quality

4.3.1(b) VENCorp is responsible for ensuring gas complies with prescribed specifications.

RP

4.3.1(d) Participants must comply with gas quality specifications. CP

4.3.1(e) Requirement of gas quality monitoring at all system injection points.

CP

4.3.2(b)(1) If VENCorp considers contract not being complied with or that conditions can no longer be satisfied, VENCorp must notify Market Participants that gas quality standards no longer approved (and VENCorp may refuse to accept gas).

RP





4.3.2(b)(2) Market Participant must not inject any further gas. CP

4.3.3(a) Provision of gas quality monitoring system by Transmission Pipeline Owner.

CP

4.3.3(b) Gas quality monitoring system must be approved by VENCorp.

CP

4.3.3(c) Gas quality monitoring system must perform certain functions.

CP

4.3.3(d) Gas quality monitoring system must include certain equipment.

CP

4.3.3(e) Provider of gas quality monitoring system must ensure data transmitted in form and manner compatible with database.

CP

4.3.3(f) Submission of plan to VENCorp by provider of gas quality monitoring system.

CP

4.3.3(g) Provision of information by provider of the gas quality monitoring system and payment of costs by party requesting information.

CP

4.3.4(a) Participant must use reasonable endeavours to ensure that any gas complies with the gas quality specifications.

CP

4.3.4(c) VENCorp must not refuse to accept gas which complies with gas quality specifications.

RP

4.3.4(d) Notification by Participants if aware gas does not comply with gas quality specifications.

CP

4.3.4(f) Notification by VENCorp if it intends to accept off-specification gas.

RP

4.4 Metering

4.4.1(e)(3) Costs of new metering installations, modifications to existing metering installations and decommissioning to be borne by affected Participant.

CP

4.4.3(c) Agreement by Participants under this clause must not be unreasonably withheld.

CP

4.4.3(d) A person who is not a Participant may only be a responsible person if it agrees with VENCorp to be bound by this clause and other conditions VENCorp may reasonably require.

CP





4.4.3(e) Notification by person who would otherwise be the responsible person.

CP

4.4.4 Obligations of responsible person. CP

4.4.5 Affected Participant may provide additional equipment provided such equipment complies with certain requirements.

CP

4.4.6 Metering installation must comply with certain requirements.

CP

4.4.7 Responsible person must ensure metering installation is located as close as practicable to relevant point.

CP

4.4.8 Accuracy requirements for metering installation. CP

4.4.9(b) Responsible person must ensure metering installation is calibrated in accordance with schedule.

CP

4.4.9(c) VENCorp must review calibration requirements and publish changes.

RP

4.4.9(d) Establishment of calibration procedures by responsible person.

CP

4.4.9(f) Making of results of tests available by responsible person.

CP

4.4.9(h) Responsible person must permit representatives to be present at calibration.

CP

4.4.9(i) Responsible person must give notice of calibration. CP

4.4.9(j) Notification by affected Participants who wish to have representative present. Parties must use reasonable endeavours to agree time and date.

CP

4.4.9(m) Cost of calibration must be borne by person requiring calibration or responsible person.

CP

4.4.9(n) Monitoring of metering installations by responsible person on regular basis.

CP

4.4.9(o) Obligations of responsible person if it becomes aware that the accuracy of a metering installation does not comply with clause 4.4.

CP

4.4.9(p) Obligation of responsible person to provide report and estimate quantity of gas transferred after it becomes aware of any matter described in clause 4.4.9(o).

CP





4.4.9(q) Notification by responsible person of modification, adjustment, etc, of metering installations.

CP

4.4.10(a) Protection of metering installation by responsible person. CP

4.4.10(b) Notification by Participant if evidence of tampering found. CP

4.4.10(c) Testing by responsible person if evidence that accuracy might have been affected by tampering.

CP

4.4.10(d) Payment of costs by a Participant who interferes with a metering installation without approval.

CP

4.4.11 Protection of metering data by responsible person. CP

4.4.12(a),(b)

Notification and confirmation to VENCorp by a responsible person of changes to parameters or settings.

CP

4.4.12(c) Recording of changes to parameters or settings by VENCorp in metering register.

RP

4.4.13(a) Responsible person must ensure that the metering installation complies with this clause 4.4.13.

CP

4.4.13(b), (c) & (e)

Metering installations must be capable of determining the energy content.

CP

4.4.13(g) Determination by VENCorp of the source of data used for determining the energy content of gas.

RP

4.4.13(h) VENCorp’s obligations associated with determining appropriate source of data.

RP

4.4.13(i) VENCorp to ensure heating values are to be applied. RP

4.4.13(j) Data must be averaged and applied by responsible person for the purpose of measuring energy content of gas.

CP

4.4.13(k) Metering installation must be capable of recording metering data transmitted to metering database.

CP

4.4.14(a) Responsible person must procure that metering data is transmitted to metering database.

CP

4.4.14(b) Responsible person to procure repairs are made to metering installations.

CP

4.4.14(c) Advice by Participant to VENCorp of metering installation malfunction or defect.

CP





4.4.15(a) Meter clocks must be referenced to Australian Eastern Standard Time.

CP

4.4.15(b) Metering data must be set within specified accuracy limits.

CP

4.4.16(a) Provision of pulse outputs by responsible person. CP

4.4.16(b) Payment of costs by person requesting the pulse output. CP

4.4.17 Protection of data in metering installation by responsible person.

CP

4.4.18(a) VENCorp must collect metering data so as to determine certain matters.

RP

4.4.18(b) Participants to use reasonable endeavours to provide metering data.

CP

4.4.18(c), (d)

Obligation of responsible person to ensure data capable of transmission/accessible by VENCorp.

CP

4.4.19 Creation of installation database by responsible person and ensuring VENCorp and affected Participants have access.

CP

4.4.20 Creation and maintenance of metering database and granting of access to metering database by VENCorp.

RP

4.4.21(a),(b)

Maintenance of metering register by VENCorp.

RP

4.4.21(c)(1)

Advice by VENCorp if information in metering register indicates that a metering installation does not comply with this clause.

RP

4.4.21(c)(2)

Obligation of responsible person to procure that the metering installation does comply.

CP





4.4.21(ca), 4.4.21(d)

VENCorp must establish transfer procedures to deal with registration procedures of Non-Franchise Customers transferring between Retailers.

............................

RP




---- reference to 4.4.21(ca), 4.4.21(d) to be deleted without replacement

4.4.22(e) Responsible person to ensure congestion does not occur.

CP

4.4.22(f) Responsibility of responsible person to ensure that persons have access.

CP

4.4.22(g) Obligation of responsible person to provide local reading. CP

4.4.23 Payment for access to metering data by Participant to whom access provided.

CP

4.4.24(a)-(f), (h)

Validation and substitution of metering data by VENCorp.

RP

4.4.24(g) Obligations of affected Participant and VENCorp if an affected Participant disputes a substitution made by VENCorp.

RP

4.4.25 Obligation of Participants to ensure passwords and metering data are treated as confidential information.

CP

4.4.26(a) Metering data must be used by VENCorp as the primary source of data for settlements.

RP

4.4.26(c)

Where metering installation used for additional purpose, must not be inconsistent with, or cause Participant to breach Rules or laws;

Responsible person must co-ordinate with persons who use metering installation for other purposes.

CP

CP





4.4.27(2), 4.4.28

VENCorp must undertake review of the metering provisions.

RP

5. MARKET INFORMATION AND SYSTEM PLANNING

5.1 Market Information5.1.1(b) Information concerning the operation of the market must

be made available by VENCorp. VENCorp may charge a fee.

RP

5.1.1(c) Information in relation to the market price must be made available by VENCorp.

RP

5.1.2(a) All information by Participants to VENCorp must be provided by means of the electronic communication system.

CP

5.1.2(b) Information must be provided using templates. CP

5.1.2(c) Information must be time stamped by VENCorp. RP

5.1.2(e) Development of electronic communication procedures by VENCorp.

RP

5.1.3 Establishment, maintenance and publication of Participant data by VENCorp.

RP

5.1.4 Publication of schedules by VENCorp. RP

5.1.5 Market information must be made available by VENCorp. RP

5.1.6 VENCorp must retain records for seven years. RP

5.1.7 VENCorp must arrange for a Review. RP

5.2.1(b), (c), (d)

VENCorp must provide planning reviews and use reasonable endeavours to ensure that planning reviews accurately reflect the information provided to VENCorp.

RP

5.2.2 Preparation and provision of annual planning reviews by VENCorp.

RP

5.2.3(a) Preparation and provision of biannual planning reviews by VENCorp.

RP

5.2.3(b),(c),(d)

Information which must be included by VENCorp in the biannual planning reviews.

RP





5.2.3(e) VENCorp must update biannual planning review if previous review becomes materially inaccurate.

RP

5.2.4(a)-(e) Provision of forecasts by Participants. CP

5.2.4(f) Confidentiality obligations of VENCorp. RP

5.2.4(h) Obligations of Participants to provide information in good faith and to ensure the information is accurate.

CP

5.2.6(a) Co-ordination of maintenance by VENCorp to ensure system security.

RP

5.2.6(b) Development of operating procedures by VENCorp. RP

5.2.6(c) Obligation of Transmission Pipeline Owner to act in accordance with forecasts.

CP

5.2.6(d)

Obligation of Pipeline Owner/Storage Providers to act in accordance with forecasts.

Co-operation by Pipeline Owners/Storage Providers.

CP

CP

5.2.6(f) Provision of information by Pipeline Owners/Storage Providers if breakdown or potential breakdown of equipment.

CP

5.2.6(g) Provision of details of defect in equipment by VENCorp. RP

5.3 MDQ authorisation5.3.1(a), (b) VENCorp and a Transmission Pipeline Owner must enter

into a service envelope agreement.CP

5.3.1(d) VENCorp and Transmission Pipeline Owner must supply information requested by independent person.

RP

5.3.1(f) VENCorp and Transmission Pipeline Owner must ensure resolution of disagreement reflected in service envelope agreement.

CP

5.3.2(a) VENCorp must allocate authorised MDQ. RP

[5.3.2(b) deleted: Order in Council dated 10 March, published in the Government Gazette dated 11 March 1999]

5.3.2(c) VENCorp must notify Market Participants to whom authorised MDQ is allocated.

RP

5.3.2(d) A Retailer must notify its Customers of the Customer’s authorised MDQ.

CP





5.3.2(e) VENCorp must advise a Customer of the Customer’s authorised MDQ.

RP

5.3.2(h) VENCorp must prepare a report on authorised MDQ allocated under clause 5.3.2.

RP

5.3.3(a) A Transmission Pipeline Owner who extends or expands its pipeline must consult with VENCorp.

CP

5.3.3(b), 5.3.3(ba) VENCorp must allocate additional authorised MDQ and AMDQ credit certificates according to the direction of Transmission Pipeline Owner.

RP

5.3.3(c) VENCorp must not allocate authorised MDQ and AMDQ credit certificates except in accordance with the direction of relevant Transmission Pipeline Owner.

RP

5.3.3(d) VENCorp and Transmission Pipeline Owner must modify existing service envelope agreement.

CP

[5.3.3(e) reference deleted by notice published in the Government Gazette dated 28 February 2002]

[5.3.3(f) reference deleted by notice published in the Government Gazette dated 28 February 2002]

5.3.4(a) VENCorp must allocate spare authorised MDQ. RP

5.3.4(b) VENCorp must develop and publish procedures for the transfer of authorised MDQ

RP

[5.3.4(c) and (d) deleted: Order in Council dated 10 March 1999, published in the Govenrmant Gazette dated 11 March 1999]

5.3.4(e) Requirements to be observed by VENCorp in allocating spare authorised MDQ.

RP

5.3.4(g) VENCorp must use monies received from auctioning authorised MDQ to offset its costs.

RP

5.3.5(a) Persons may transfer Authorised MDQ in accordance with procedures developed and published by VENCorp

CP

5.3.5(b) VENCorp must develop and publish procedures for the transfer of authorised MD.

RP

5.3.6(a) Authorised MDQ of a person disconnected from the transmission system reverts to VENCorp.

CP



5.3.6(b) Authorised MDQ and AMDQ credit certificates of a person disconnected from the transmission system reverts to the originally issuing Transmission Pipeline Owner.

CP



5.4 Confidentiality5.4.1 Obligation of VENCorp/Participants to keep information

confidential.RP

5.4.3 Precautions by VENCorp/Participants to ensure recipients keep information confidential if information disclosed.

RP

5.4.4 Indemnification of VENCorp by Participants. CP

5.4.5 Obligation of Participants to comply for three years after ceasing to be a Participant.

CP

5.4.6 Development and implementation of confidentiality policy by VENCorp.

RP

6. INTERVENTION AND MARKET SUSPENSION

6.1 Overview6.1.2 Responsibility of VENCorp (and acknowledgments by

Participants).RP

6.2 Emergencies6.2.1(c) Participant must notify VENCorp of emergencies/action

taken.CP

6.2.1(g) Participants must ensure its safety plan permits it to comply with emergency directions.

CP

6.2.1(i) Notification by VENCorp of end of emergency. RP

6.2.2.(c)-(e) Obligation of VENCorp to prepare emergency procedures and make available emergency procedures to each Participant.

RP

6.3 Emergency Planning by Participants6.3.1 Provision of emergency contact information by

Participants.CP

6.3.2 Establishment and maintenance of internal safety procedures by Participants.

CP

6.3.3 Obligation of Participants to ensure officers/staff/customers familiar with procedures.

CP



6.4 Emergency Curtailment of Customers6.4.1 Provision of curtailment information by Distributors. CP

6.4.2 Provision of curtailment information by Transmission Customers.

CP

6.4.3 Preparation of emergency curtailment list and notification by VENCorp.

RP



6.5 Response to Emergency 6.5.1(a) Obligation of VENCorp to provide information when an

emergency arises.RP

6.5.1(b) Obligation of each Participant to advise officers/staff of the nature and existence of an emergency.

RP

6.5.1(c)(1) VENCorp may issue such emergency directions as it reasonably considers necessary.

RP

6.5.1(c)(2) Obligations of each Participant during an emergency. CP

6.5.1(d) Participants must use reasonable endeavours to ensure that its Customers act in a manner which enables the Participant to comply with its obligations.

RP

6.5.1(e) VENCorp must decide which requirements are to prevail in the event of conflict between procedures, chapter 6 and an emergency direction.

RP

6.5.2(b) Obligation of each Participant to comply with all such emergency directions.

CP

6.5.2(e) Shortfall to be paid to VENCorp by Market Participants. CP

6.5.3(b) Obligation of Participants to comply with such emergency directions.

CP

6.5.3(e) Shortfall to be paid to VENCorp by Market Participants. CP

6.6 System Security Threat6.6.1(a) Provision of details of threat to system security to

Participants by VENCorp.RP

6.6.1(c) Obligation of Participants to provide information to VENCorp.

CP

6.6.1.(d) VENCorp must treat information as confidential and only use it for certain purposes.

RP

6.6.1(e) Obligation of VENCorp to inform to Participants when threat to system security at an end.

RP





6.6.2(a) Facilitation of response to system security threat by VENCorp.

RP

6.6.2(b) Obligations on VENCorp to take certain action if insufficient time for a threat to system security to subside.

RP

6.6.3(a) If VENCorp believes that sufficient time exists for a threat to system security to subside without intervention, VENCorp must take certain action.

RP

6.6.3(b) Obligation of Participants to comply with all requests and directions issued by VENCorp.

CP

6.6.4 If VENCorp believes insufficient time exists for threat to system security to subside without intervention, VENCorp must intervene.

RP

6.6.5.(c) Obligation of VENCorp to request the Adviser to establish a compensation panel and to refer the claim to the Adviser.

RP

6.6.5(d) Obligation of Adviser to establish compensation panel. RP

6.6.5(e) Determination of issues by compensation panel. RP

6.6.5.(f) Conduct and bases of determination by compensation panel.

CP

6.6.5(g) Compensation of Market Participant by VENCorp. CP

6.7 Force Majeure and Market Suspension6.7.1 Development and publication by VENCorp of

administered price cap.RP

6.7.2(c) Notification by VENCorp of force majeure event. RP

6.7.2(d) Participants must use reasonable endeavours not to exacerbate and must mitigate effects of force majeure event.

CP

6.7.2(e) If any force majeure event occurs VENCorp must declare administered price period.

RP

6.7.3(b) VENCorp must not declare the market to be suspended solely because of certain factors.

RP

6.7.4 Declaration and notification of market suspension by VENCorp.

RP





6.7.5(a) Market price during market suspension must be determined by VENCorp in accordance with clause 3.2.2.

RP

6.7.6(c) VENCorp must request the Adviser to establish a compensation panel and to refer the claim to the Adviser for determination.

RP

6.7.6(d) Adviser must establish compensation panel. RP

6.7.6(e) Compensation panel must make determination and notify VENCorp.

RP

6.7.6(f) Conduct and bases of determination of compensation panel.

RP

6.7.6(g) VENCorp must compensate the Market Participant in accordance with determination.

CP

6.7.7 VENCorp must publish intervention report. RP

6.8 Review of Chapter 66.8.1 Timing of review. RP

6.8.2 Terms of reference. RP

6.8.3 Process of review. RP

7. ENFORCEMENT AND DISPUTES

7.1 Enforcement7.1.1(b) If VENCorp requests information from Participants,

VENCorp must provide reasons.RP

7.1.1(c) Participants must comply with a request made by VENCorp.

CP

7.1.1(e) Provision of assistance to investigator by Participants. CP

7.1.1(f) Cost of investigation to be met by Participants. CP

7.1.2 VENCorp obligations concerning alleged breaches of Rules.

RP

7.1.5 Publication by VENCorp of report summarising decisions of VENCorp in relation to enforcement.

RP

7.2 Dispute Resolution7.2.1(b) Obligation of parties to comply with the procedures. RP





7.2.1(c) Party must apply to the Regulator if parties cannot agree on procedures.

RP

7.2.1(d) Regulator must decide and direct the parties. RP

7.2.1(g) Parties must comply with the decision of the Regulator. RP

7.2.2(a)-(c) VENCorp must appoint Adviser, having regard to certain matters.

RP

7.2.2(d) VENCorp may terminate appointment if, in its reasonable opinion, the Adviser does not meet the requirements.

RP

7.2.2(e)-(h) VENCorp, in consultation with the Adviser, must select group to constitute dispute resolution panel, having regard to certain matters.

RP

7.2.3(c)

Adviser must notify all other parties of the dispute;

Provision of information by parties if requested by Adviser.

RP

7.2.3(f) Appointment of dispute resolution panel and reference of dispute to dispute resolution panel by the Adviser.

RP

7.2.4(a) Adviser must establish dispute resolution panel. RP

7.2.4(c) Dispute resolution panel must select procedures to apply to the dispute resolution process.

RP

7.2.4(d) Venue to be determined by the dispute resolution panel. RP

7.2.4(e) Compliance by parties with any procedural requirements imposed by the dispute resolution panel.

CP

7.2.4(f) Period within which the dispute resolution panel must give notice of its determination.

RP

7.2.4(g) Provision of written notice to dispute resolution panel by the parties describing action taken following dispute resolution panel’s determination.

RP

7.2.5(d) Adviser must notify all Participants who may be affected. RP

7.2.5(e) Monies must be paid on the date specified for payment in the settlement statement.

CP

7.2.6(a) Issue of revised settlement statement by VENCorp. RP

7.2.6(b) Payment by relevant Participant of the amount specified. CP

7.2.9 Determination is binding on the parties and the parties are obliged to comply with a determination.

CP





7.2.10(a) Written details of the resolution must be sent to the Adviser by the chairman of the dispute resolution panel.

RP

7.2.10(b) Summary of resolution to be sent by Adviser to VENCorp and the parties.

RP

7.2.10(d) Results of dispute resolutions must be made available by VENCorp to certain persons.

RP

7.2.13 Indemnification by VENCorp of Adviser and members of dispute resolution panel.

CP

8. RULES CHANGES8.1(a) Rules may only be changed by the board of directors of

VENCorp if certain matters are satisfied.RP

8.1(b) Implementation of rule change by VENCorp on effective date.

RP

8.1(c) Rule change report must be developed and made available by VENCorp to Participants.

RP

8.3 VENCorp must consider certain matters in assessing a proposed Rule change.

RP

8.4(a) Decision by VENCorp on Rule change proposed by other person as soon as possible unless VENCorp reasonably considers it has insufficient information or it is not practicable.

RP

8.4(b) VENCorp Board must not approve Rule change unless satisfied of certain matters.

RP

8.4(c) If VENCorp Board rejects proposed Rule change, VENCorp must give notice.

RP

8.5 Submission of proposed change by VENCorp to Regulator.

RP

8.6 Assessment and notification by Regulator of proposed Rule change.

RP

8.7 VENCorp must take certain action following Regulator’s decision.

RP

8.8(a) Notification by Regulator of approval of Rule change to VENCorp.

RP

8.8(b) Written notice of rule change by VENCorp to all Participants.

RP





8.8(c) Notification to Participants by VENCorp of the date on which the rule change is to take effect.

RP

9. TRANSITIONAL ARRANGEMENTS9.1.1(a) VENCorp must establish a gas market review committee

by 1 September 1999.RP

9.1.1(b) Gas market review committee to consist of certain members.

RP

9.1.1(c) VENCorp must appoint one member of the gas market review committee to act as Chairman.

RP

9.1.1(d) VENCorp must provide administrative support. RP

9.1.1(e) The gas market review committee must prepare procedures for governing its operation and review the need for a change to locational and hourly pricing.

RP

9.1.1(f) The gas market review committee must undertake a review in accordance with public consultation procedures and may engage suitably qualified external consultants.

RP

9.1.1(g) VENCorp is to fund the costs of engaging consultants from market fees.

RP

9.1.1(h) The gas market review committee must take into account certain factors.

RP

9.1.1(i) The gas market review committee must prepare and submit a report by 1 December 1999.

RP

9.1.1(j) The report submitted by the gas market review committee must include certain information (if the committee endorses the change to hourly and locational pricing).

RP

9.1.1(k) If the gas market review committee concludes that hourly, locational pricing should not be introduced, the report (submitted under clause 9.1.1(i)) must contain a recommendation for Rules changes.

RP

9.1.1(l) VENCorp must establish procedures for transition to locational and hourly pricing if recommended by gas market review committee.

RP

9.1.1(m) If gas market review committee does not reach a conclusion, VENCorp must proceed with transition to hourly and locational pricing.

RP





9.1.2 VENCorp must give effect to contract for Interconnect between Victoria and New South Wales and amend these Rules.

RP

10. INTERPRETATION10.5 Participants must not assign rights or obligations under

these Rules.CP

10.7 Method of payment under Rules. CP

10.9 Records and documents must be retained for seven years.

RP





CHAPTER 8. RULES CHANGES



8.1 CHANGING THESE RULES

(a) These Rules may only be changed by the Board of Directors of VENCorp in accordance with clause 8.1(b) if:

(1) any person including VENCorp proposes a Rule change; and

(2) where the Rule change is proposed:

(A) by a person other than VENCorp, the Board of Directors of VENCorp approves the proposed Rule change under clauses 8.3 and 8.4; or

(B) by VENCorp, VENCorp has complied with clause 8.3 and the Board of Directors of VENCorp is satisfied that the Rule change satisfies the provisions of clause 8.2(b)(3) and is consistent with the performance by VENCorp of the VENCorp functions; and

(3) when clause 8.1(a)(2) is satisfied, the Regulator has considered the proposed Rule change and if necessary, grants an authorisation in respect of these Rules as amended by the proposed Rule change in accordance with clauses 8.5 and 8.8.

(b) A Rule change will become effective on the date specified in a notice sent to Participants by VENCorp in accordance with clause 8.8 and VENCorp must do all things necessary to implement the Rule change on that date.

(c) VENCorp must develop and, during March each year, make available to Participants a report which sets out:

(1) all Rule change proposals which have been made in the previous twelve month period and any decisions (but not the reasons for those decisions) and any requests for further information made by VENCorp under clause 8.4 in relation to those Rule change proposals;

(2) the progress of those Rule change proposals in accordance with the procedures prescribed in this chapter 8;

(3) the reason for any delays in relation to the progress of those Rule change proposals and any action VENCorp has taken to overcome those delays; and

(4) any other matter which VENCorp reasonably considers to be relevant to the progress of Rule change proposals, including but not limited to any policies developed by VENCorp in relation to:

(A) the way in which it intends to deal with any procedure specified in this chapter 8; and

(B) the facts, matters or circumstances which VENCorp may take into account in making a decision and otherwise discharging its functions and obligations under this chapter 8,

providing that nothing in this clause 8.1(c)(4) is to be taken to limit the exercise by VENCorp of its discretion under this chapter 8.

8.2 PROPOSALS BY PERSONS OTHER THAN VENCORP

(a) If a person other than VENCorp proposes a Rule change, that person must submit the proposed Rule change to VENCorp.

(b) A submission made under clause 8.2(a) must:

(1) be in writing;



(2) include the name and address of the applicant;

(3) demonstrate that the Rule change is:

(A) consistent with the market objectives;

(B) feasible;

(C) not unreasonably costly to implement; and

(D) a more appropriate or better means of achieving the criteria set out in clauses 8.2(b)(3)(A) to (C), where the effect of the Rule change will be to replace an existing Rule;

(4) include a brief statement of the reasons why a Rule change is necessary or desirable; and

(5) contain sufficient information to permit a proper consideration by VENCorp of those reasons, including the public benefit (if any) of making the Rule change.

(c) A submission made under clause 8.2(a) may include a draft of the relevant Rule change.

8.3 VENCORP’S CONSIDERATION OF PROPOSED RULE CHANGE

In considering a Rule change proposed by a person other than VENCorp, or before itself proposing a Rule change, VENCorp:

(a) must take into account any information and documents which VENCorp reasonably considers to be relevant to its consideration of the proposed Rule change;

(b) must consult with persons who VENCorp reasonably considers will be likely to be affected by the proposed Rule change; and

(c) may seek such information and views from any person in relation to the submission as may be practicable in the circumstances, having regard to the nature of the proposed Rule change.

8.4 VENCORP DECISION ON RULE CHANGE PROPOSED BY OTHER PERSON

(a) Subject to clauses 8.4(b) and (c), the Board of Directors of VENCorp must make a decision to approve or reject a Rule change proposed in accordance with clause 8.2 as soon as practicable but in any event within sixty days of VENCorp receiving a proposal for a Rule change unless:

(1) VENCorp reasonably considers that it has insufficient information to enable it to make a decision under this clause 8.4 in which case VENCorp may request the person who made the submission under clause 8.2(a) to provide to VENCorp that further information and the sixty day period within which VENCorp is otherwise required to make a decision under this clause 8.4 is then to be extended by the number of days in the period commencing on the day of VENCorp’s request for further information to and including the day on which VENCorp received that information; or

(2) VENCorp reasonably considers that due to the nature of the proposed Rule change and the supporting information to be assessed by the Board of Directors of VENCorp in making its decision under this clause 8.4, it is not practicable for VENCorp to make a decision within sixty days in which case VENCorp may extend the period within which it must make a decision under this clause 8.4 by a maximum further period of thirty days, resulting in a total maximum period of ninety days.



(b) The Board of Directors of VENCorp must not decide to approve a Rule change proposed in accordance with clause 8.2 unless satisfied that the Rule change is consistent with the performance by VENCorp of the VENCorp functions.

(c) If the Board of Directors of VENCorp decides to reject a Rule change proposed in accordance with clause 8.2:

(1) VENCorp must give notice of its decision to the person or persons who made the submission; and

(2) that decision is final.

8.5 APPLICATION TO THE REGULATOR

(a) If a Rule change is:

(1) proposed by VENCorp; or

(2) proposed by a person other than VENCorp,

and approved by the Board of Directors of VENCorp in accordance with clauses 8.3 and 8.4, then VENCorp must as soon as practicable make application to the Regulator for the granting of authorisation of that Rule change under the Trade Practices Act 1974 (Cth).

(b) A proposed Rule change which is submitted to the Regulator under clause 8.5(a) must be accompanied by:

(1) any supporting information that VENCorp:

(A) considers relevant and appropriate; and

(B) is able to provide to the Regulator,to enable the Regulator properly to assess the merits of the Rule change;

(2) a description of the possible effect (if any) of the Rule change on access arrangements given under the Access Code;

(3) a description of the possible effect (if any) of the Rule change on any authorisations granted by the Regulator in respect of these Rules or whether the Rule change otherwise requires authorisation by the Regulator;

(4) a statement from VENCorp confirming that the procedures set out in this chapter 8 have been followed in relation to the proposed Rule change;

(5) the date on which the proposed Rule change is to take effect.

Sub-clause 8.5(b)(6) deleted by notice published in the Government Gazette dated 28 February 2002.

8.6 THE REGULATOR’S ASSESSMENT OF RULE CHANGE

(a) When a proposed Rule change is submitted to the Regulator under clause 8.5, the Regulator must assess the proposed Rule change as to whether:

(1) the proposed Rule change would or would be likely to:

(A) materially change the circumstances or conditions of any authorisation granted by the Regulator in respect of these Rules; or

(B) materially change the circumstances of any access arrangement given to the Regulator under the Access Code; or



(C) result in a contravention of a provision of the Trade Practices Act 1974 (Comm) for which no authorisation granted by the Regulator exists; or

(2) the procedures in this chapter 8 were not substantially followed in relation to the proposed Rule change; or

(3) any combination of these matters applies.

(b) The Regulator may, before providing its determination, require VENCorp to provide more information in relation to the proposed Rule change.

(c) For the avoidance of doubt:

(1) the functions and powers conferred on the Regulator under this clause 8.6 are conferred pursuant to section 19 of the Gas Industry Act and not pursuant to any other Act or law; and

(2) authorisation, if granted by the Regulator will in no way bind the Regulator nor constrain or fetter the Regulator’s functions, powers or discretions under the Trade Practices Act 1974 (Comm), the Access Code, the Gas Industry Act or any other applicable Act or law.

(d) If the Regulator declines jurisdiction to grant an authorisation in response to an application made to the Regulator for an authorisation (including a variation of an existing authorisation) then VENCorp may implement the Rule change in accordance with clause 8.8(a) as if the Regulator had granted the authorisation (or the variation).

Clause 8.7 deleted by notice published in the Government Gazette dated 28 February 2002.

8.8 IMPLEMENTATION OF RULE CHANGE

(a) If the Regulator has granted an authorisation (including a variation of an existing authorisation) or approved an access arrangement (including amendment of an existing access arrangement) as contemplated by clause 8.7, VENCorp must provide written notice of the Rule change to all Participants as soon as practicable and in any event within ten business days of receiving notification of the Regulator’s approval.

(b) A notice to Participants provided by VENCorp under clause 8.8(a) must specify the date on which the Rule change is to take effect which, subject to clause 8.8(d), must be a date no more than seven days after that notice is sent to Participants by VENCorp, unless:

(1) VENCorp in its absolute discretion considers there to be justification for implementing the Rule change with effect from a date more than seven days after that notice is sent to Participants; or

(2) these Rules require the Rule change to take effect after or within a particular period which is more than seven days after that notice is sent to Participants,

in which case the Rule change will take effect on the date specified in that notice.

(c) A Rule change may be made with retrospective effect, if the Board of Directors of VENCorp considers that it is necessary to do so in the circumstances, including but not limited to where these Rules contain a manifest error or where procedural requirements in these Rules produce unintended consequences.

Clauses 8.8(d) and 8.8(e) deleted by notice published in the Government Gazette dated 28 February 2002.





CHAPTER 9. TRANSITIONAL ARRANGEMENTSAND DEROGATIONS



Clause 9.1 deleted by notice published in the Government Gazette dated 28 February 2002.

9.2 DEROGATIONS

9.2.1 Longford measuring station(a) The provisions of clause 4.4 (other than the provisions of clauses 4.4.2(a)(1) and (3),

4.4.3, 4.4.5, 4.4.6(b) and (e), 4.4.12, 4.4.14 (a)(2) and (3), (b) and (c), 4.4.15(a), 4.4.17, 4.4.18, 4.4.19, 4.4.20, 4.4.21(a), (b), (d) and (e), 4.4.22, 4.4.23, 4.4.24, 4.4.25, 4.4.26 and 4.4.27) do not apply to the metering installation which is adjacent to the system injection point at Longford and which is the subject of the gas sales agreement dated 20 November 1996 between Esso Australia Resources Ltd, BHP Petroleum (Bass Strait) Pty Ltd and Gascor.

(b) The derogation contained in clause 9.2.1(a) ceases when the metering installation referred to in that clause is replaced, upgraded or materially modified.



CHAPTER 10 INTERPRETATION



10 INTERPRETATION

10.1 INTERPRETATION

In interpreting or applying any provision of these Rules, such fair large and liberal interpretation shall be given as will best achieve the intent and object of these Rules both generally and in any specific case.

10.2 GENERAL

In these Rules, unless the context otherwise requires:

(a) headings are for convenience only and do not affect the interpretation of these Rules;

(b) words importing the singular include the plural and vice versa;

(c) words importing a gender include any gender;

(d) where italicised, a word or phrase has the definition given to that word or phrase in chapter 11;

(e) other parts of speech and grammatical forms of a word or phrase defined in these Rules have a corresponding meaning;

(f) an expression importing a natural person includes any company, partnership, joint venture, association, corporation or other body corporate and any government agency;

(g) a reference to any thing (including, but not limited to, any right) includes a part of that thing;

(h) a reference to a clause, paragraph, part, annexure, exhibit or schedule is a reference to a clause and paragraph and part of, and an annexure, exhibit and schedule to these Rules and a reference to these Rules includes any annexure, exhibit and schedule;

(i) a reference to a statute, regulation, proclamation, order in council, ordinance or by-law includes all statutes, regulations, proclamations, orders in council, ordinances or by-laws amending, consolidating or replacing it, and a reference to a statute includes all regulations, proclamations, orders in council, ordinances, and by-laws issued under that statute;

(j) a reference to these Rules or to a document or a provision of a document includes an amendment or supplement to, or replacement or novation of, these Rules or that document or that provision of that document;

(k) a reference to a person includes that person’s executors, administrators, successors, substitutes (including, without limitation, persons taking by novation) and permitted assignees;

(l) a reference to a body other than a Participant or VENCorp (including, without limitation, an institute, association or authority), whether statutory or not:

(1) which ceases to exist; or

(2) whose powers or functions are transferred to another body,

is a reference to the body which replaces it or which substantially succeeds to its powers or functions;

(m) a reference in the context of any provision of these Rules to a “representative” of any person is a reference to any director, officer or employee of that person or any agent,



consultant or contractor appointed or engaged by that person for purposes connected with the subject matter of the relevant provision of these Rules; and

(n) nothing contained in a document referred to in these Rules, beyond what is expressly contemplated by these Rules as being contained in such document or is necessary for the purposes of giving effect to a provision of these Rules, shall modify or have any effect for the purposes of these Rules or be construed as relevant to the interpretation of these Rules.

(o) italicisation is used as a guide only to the fact that a word or phrase is defined in Chapter 11.

10.3 TIMES AND DATES

(a) Unless the context otherwise requires, or except where these Rules expressly provide to the contrary, a reference in these Rules:

(1) to a calendar day (such as 1 January) or a day of the week (such as Sunday) is to the day which begins at 00:00 hours on that day;

(2) to a week is to the period from 00:00 hours on a day until 00:00 hours on the seventh day following;

(3) to a month (or a number of months) or a calendar month is to the period from 00:00 hours on a day in one month until 00:00 hours on the same day of the month which follows (or follows by the relevant number of months), or if there is no such day in that month, 00:00 hours on the first day of the next following month;

(4) to a year is to the period from 00:00 hours on a day in one year until 00:00 hours on the same day (or where the day in the first year was 29 February, on 1 March) in the following year, and a reference to a calendar year (such as 1997) is to be construed accordingly; and

(5) to times of the day is to Eastern Standard Time.

(b) Unless the context otherwise requires, a period of time:

(1) which dates from a given day or the day of an act or event is to be calculated exclusive of that day; or

(2) which commences on a given day or the day of an act or event is to be calculated inclusive of that day.

(c) Where under any provision of these Rules a person is required to provide any information by a certain date or time, the relevant provision is to be taken to include a requirement that that information must be provided not earlier than is reasonable before that date or time.

(d) Notwithstanding any other provision of these Rules, VENCorp may with the prior agreement of all affected Participants amend any amount, date, time or period of time specified in these Rules in any particular case or generally, whether before or after the expiry of that date, time or period of time as the case may be, provided that if such agreement is not obtained, VENCorp may, on notice given to all affected Participants and with the approval of the Regulator, amend any such amount, date, time or period of time in any particular case or generally, whether before or after the expiry of that date, time or period of time, as the case may be.

(e) In these Rules, where after any time of the day “(Local Melbourne Time)” appears, that is to be taken to mean that that time of the day is:

(i) Summer Time if Summer Time is in force in Victoria; and

(ii) Eastern Standard Time if Summer Time is not in force in Victoria.



(f) In these Rules:

“Eastern Standard Time” means standard time as defined in the Summer Time Act 1972 (Vic).”; and

“Summer Time” means summer time as defined in the Summer Time Act 1972 (Vic).”.

10.4 TECHNICAL INTERPRETATION

(a) Unless the context otherwise requires, for the purposes of these Rules:

(1) a “quantity” of gas is a quantity in joules; and

(2) a “volume” of gas is a volume in standard cubic metres.

(b) The following terms have the following meanings in these Rules:

(1) “gas” means any naturally occurring:

(A) hydrocarbon in a gaseous state consisting principally of methane; or

(B) mixture of hydrocarbons in a gaseous state consisting principally of methane which may contain other gases (including the residue resulting from the treatment of processing of natural gas),

and includes gas that has been injected into and stored in a storage facility;(2) “gigajoule” or “GJ” means 1,000 megajoules;

(3) “joule” means the joule as defined in AS1000-1979 “The International Systems of Units (SI) and its Application”;

(4) “kPa” or “kilopascal” means 1,000 pascals as defined in AS1000-1979 “The International System of Units (SI) and its Application”;

(5) “megajoule” or “MJ” means 1,000,000 joules;

(6) “standard cubic metre” or “m³” means the quantity of dry gas at a temperature of 15 degrees celsius and an absolute pressure of 101.325 kPa enclosed in a volume of one cubic metre; and

(7) “terajoule” or “TJ” means 1,000 gigajoules.

(c) Unless otherwise expressly defined, all reference to units of measurements in these Rules are references to the units of measurement defined in or for the purposes of the National Measurement Act 1960 (Commonwealth).

(d) Gas measured and stated for the purposes of these Rules is to be measured and stated by reference to its energy content.

(e) Where to give effect to any provision of these Rules it is necessary to do so, a rate of injection or withdrawal of gas, or any amount of capacity or storage capacity, expressed in quantity or volume units per day, or per hour, must be treated as expressed in any other such units on the basis of the appropriate conversion.

(f) Unless the context otherwise requires, a reference to an injection of gas into, or a withdrawal of gas from, the transmission system by a person (or any obligation, right, intention or undertaking by or of a person in respect of such an injection or withdrawal) includes an injection or withdrawal of gas by another person on behalf of that person and a person is to be taken as having injected or withdrawn gas if it arranges for another person to inject or withdraw gas on its behalf.



10.5 ASSIGNMENT

Unless otherwise expressly permitted by these Rules, a Participant must not assign or transfer and must not purport to assign or transfer any of its rights or obligations under these Rules.

10.6 WAIVER

A person does not waive its rights, powers and discretions under these Rules by:

(a) failing to exercise its rights;

(b) only exercising part of its rights; or

(c) delaying the exercise of its rights.

10.7 PAYMENT

(a) Unless otherwise provided in these Rules, any payment to be made under these Rules must be made either by the EFT facility or in cash or by a draft or cheque drawn by a bank as defined in the Banking Act 1959 (Comm).

(b) Unless the context otherwise requires, a reference in these Rules to an interest rate published in respect of a specified day must, if that interest rate is not published, authorised or otherwise available in respect of that day, be taken to be the relevant interest rate published immediately prior to that day; and if that interest rate is suspended, modified, discontinued, or its method of calculation substantially alters or if the relevant publication ceases to publish that interest rate for more than seven consecutive days, VENCorp must provide a substitute rate of interest that in VENCorp’s reasonable opinion is the nearest equivalent to the interest rate and that substitute rate of interest must be taken to be the applicable interest rate.

10.8 NOTICES

(a) A notice is properly given under these Rules to a person if:

(1) it is personally served;

(2) a letter containing the notice is prepaid and posted to the person at an address (if any) supplied by the person to the sender for service of notices or, where the person is a Participant, an address shown for that person in the register of Participants maintained by VENCorp, or, where the addressee is VENCorp, the registered office of VENCorp;

(3) it is sent to the person by facsimile or electronic mail to a number or reference which corresponds with the address referred to in clause 10.8(a)(2) or which is supplied by the person to VENCorp for service of notices and, if sent by electronic mail, the person sending the notice also sends a copy of the notice by letter or facsimile to the person on the same day; or

(4) the person receives the notice.

(b) A notice is treated as being given to a person by the sender:

(1) where sent by post in accordance with clause 10.8(a)(2) to an address in the central business district of a capital city of Australia, on the second business day after the day on which it is posted; and



(2) where sent by post in accordance with clause 10.8(a)(2) to any other address, on the third business day after the day on which it is posted;

(3) where sent by facsimile in accordance with clause 10.8(a)(3) and a complete and correct transmission report is received:

(A) where the notice is of the type in relation to which the addressee is obliged under these Rules to monitor the receipt by facsimile outside of, as well as during, business hours, on the day of transmission; and

(B) in all other cases, on the day of transmission if a business day or, if the transmission is on a day which is not a business day or is after 4.00 pm (addressee's time), at 9.00 am on the following business day;

(4) where sent by electronic mail in accordance with clause 10.8(a)(3):

(A) where the notice is of a type in relation to which the addressee is obliged under these Rules to monitor receipt by electronic mail outside of, as well as during, business hours, on the day when the notice is recorded as having been first received at the electronic mail destination; and

(B) in all other cases, on the day when the notice is recorded as having been first received at the electronic mail destination, if a business day or if that time is after 4.00 pm (addressee’s time), or the day is not a business day, at 9.00 am on the following business day; or

(5) in any other case, when the person actually receives the notice.

(c) Any notice to or by a person under these Rules:

(1) must be in legible writing and in English; and

(2) where the sender is a company, must be signed by a director or secretary of that company or under the common seal of the sender (except where the notice is sent by electronic mail).

(d) Where a specified period (including, without limitation, a particular number of days) must elapse or expire from or after the giving of a notice before an action may be taken neither the day on which the notice is given nor the day on which the action is to be taken may be counted in reckoning the period.

(e) In this clause 10.8, a reference to:

(1) an addressee includes a reference to an addressee's officers, agents, or employees or any person reasonably believed by the sender to be an officer, agent or employee of the addressee; and

(2) a notice includes any request, demand, consent or approval or other communication to or by a person under these Rules.

10.9 RETENTION OF RECORDS AND DOCUMENTS

Unless otherwise specified in these Rules, all records and documents prepared for or in connection with these Rules must be retained for a period of at least seven years.

10.10 SEVERABILITY

Each part or all of a provision of these Rules:

(a) will be construed so as to be valid and enforceable to the greatest extent possible; and



(b) may be so construed (or deleted if necessary) regardless of the effect which that may have on the provision in question or any other provision or these Rules as a whole.



CHAPTER 11.GLOSSARY



11. GLOSSARY

access arrangement An arrangement for access to a pipeline or part of a pipeline, including the associated access arrangement information, that has been approved by the Regulator or the ORG pursuant to sections 2.16, 2.19 or 2.23 of the Access Code.

Access Code The Victorian Third Party Access Code for Natural Gas Pipeline Systems established under the Gas Industry Act, and where applicable, subject to sections 24A and 24B of the Gas Pipelines Access (Victoria) Act 1998, the new Access Code as more particularly described in section 24A of that Act.

actual deviation The positive or negative amount by which the actual injection or withdrawal of gas (as the case may be) for the gas day exceeds the injection or withdrawal (as the case may be) specified in the pricing schedule for that gas day.

adjusted withdrawals The adjusted quantities of gas withdrawn as determined in accordance with clause 3.6.4(d).

administered price cap A price cap determined in accordance with clause 6.7.1 which will apply during an administered price period.

administered price period A period declared by VENCorp in accordance with clause 6.7.2, during which an administered price cap will apply.

Adviser A person appointed by VENCorp under clause 7.2.2(a).

affected Participant In relation to a metering installation, a Participant who is entitled to access to metering data from that metering installation in accordance with clause 4.4.22.

allocate The process of determining an allocation.

allocation The quantity of gas treated as having been injected or withdrawn by a Market Participant at a system point in a trading interval as determined in accordance with clause 3.5.

Allocation Agent A person who has been appointed by a Market Participant to submit injection allocation statements or withdrawal allocation statements under clauses 3.5.2 or 3.5.3.



allocation algorithm The algorithm which VENCorp is required to establish under clause 3.5.4(a).

............................MSO Rules Amendments to facilitate Full Retail Contestability:



---- “allocation algorithm” to be deleted without replacement

AMDQ credit certificate A certificated right to a quantity measured in GJ and issued under clause 5.3

AMDQ credit nomination A quantity, being the whole or part of an AMDQ credit certificate, nominated by the registered holder of that AMDQ credit certificate that may be used as an AMDQ credit.

AMDQ credit The whole or part of an AMDQ credit nomination able to be utilised by the registered holder of that AMDQ credit certificate as an uplift hedge, determined in accordance with clause 3.6.8 (gc).

………………………..MSO Rules Amendments to facilitate site AMDQ credits:


Implementation of these amendments to the MSO Rules will take place on a date to be advised.

the Definition of “AMDQ credit” is to be altered as follows:

The whole or part of an AMDQ credit nomination able to be utilised by the registered holder of that AMDQ credit certificate as an uplift hedge, determined in accordance with clause 3.6.8 (gc).that may be applied by the registered holder of the AMDQ credit certificate for the purpose of;

(a) reducing the amount of uplift payments determined in accordance with clause 3.6.8; or

(b) establishing a priority of curtailment of customers in accordance with clause 6.6.4(b).

ancillary payment A payment made to a Market Participant under clause 3.6.7.

annual planning review The forecasts to be provided by VENCorp under clause 5.2.2.

authorised MDQ In respect of a Customer, the maximum daily quantity of gas, expressed in GJ/day, which is authorised by VENCorp to be withdrawn by or on behalf of that Customer, in accordance with the allocation of MDQ under clauses 5.3.2, 5.3.3 and 5.3.4.

available LNG capacity The amount of LNG storage capacity which a person holds at any time on a gas day less the amount of that person’s LNG stock at that time.

biannual planning reviews The forecasts to be provided by VENCorp under clause 5.2.3.



billing period The period of one calendar month commencing on 9.00 am on the first day of each calendar month.

BOC BOC Gases Australia Limited.

BOC Agreement The agreement dated 17 May 1995 between BOC and TPA relating to the LNG storage facility and any amendments or variations to that agreement.

business day A day other than Saturday, Sunday or a day which has been proclaimed to be a public holiday in the Melbourne metropolitan area.

commencement date The date on which these Rules first apply in accordance with clause 1.1.4.

communication link All communication equipment and arrangements that lie between the meter or data logger and the metering database.

compensation panel A panel selected by the Adviser under clauses 6.6.5 and 6.7.6 to make determinations relating to compensation during administered price periods and periods of intervention and market suspension.

confidential information Information which is or has been provided to or by a Participant or VENCorp under or in connection with these Rules and is stated under these Rules to be, or is classified by VENCorp as, confidential information or is otherwise confidential or commercially sensitive information or is information which is derived from any such information.

connect To connect a pipeline or pipeline equipment to the transmission system or modify an existing connection.

Connected Party A person (other than a Transmission Pipeline Owner) who is party to a connection agreement or who owns, operates or controls a pipeline or pipeline equipment which is connected to the transmission system.

connection A physical connection between a pipeline or pipeline equipment and the transmission system or a modification of such a connection.

connection agreement An agreement between a Transmission Pipeline Owner and another person pursuant to which a pipeline or pipeline equipment owned, operated or controlled by that other person is connected to the transmission system.

Connection Applicant A person who wants to establish a connection to the transmission system and who makes a connection application pursuant to clause 4.1.6.

connection equipment Any pipeline equipment which, in the reasonable opinion of VENCorp, is associated with a connection point, including valves, pressure regulators and metering equipment.

connection point A delivery point, a transfer point or a receipt point.

consumer surplus [Deleted: Order in Council dated 10 March, published in the Government Gazette dated 11 March 1999]



controllable quantity A quantity of gas which may be withdrawn at a delivery point and modified on a gas day in accordance with a withdrawal inc/dec offer which has been accredited by VENCorp, or a quantity of gas which may be injected at a receipt point and modified on a gas day in accordance with an injection inc/dec offer which has been accredited by VENCorp, as the case may be.

credit support An obligation owed to VENCorp by a third party supporting the obligations of a Market Participant under clause 3.7.2.

Credit Support Provider The party which assumes credit support obligations to VENCorp under clause 3.7.2.

curtailment The curtailment or interruption of a Customer’s supply of gas at its delivery point which occurs when VENCorp intervenes or issues an emergency direction.

Customer A person who purchases gas and consumes that gas at particular premises.

daily EoD linepack credit An amount determined in respect of each gas day for each Market Participant in accordance with clause 3.6.9(a).

daily EoD linepack debit An amount determined in respect of each gas day for each Market Participant in accordance with clause 3.6.9(a).

data collection system All equipment and arrangements that lie between the metering database and the point where the metering data enters the public telecommunications network.

data logger A device that collects and stores energy data or volume data and is capable of either :

(a) transfer of recorded data to a portable reading device; or

(b) being accessed electronically by VENCorp via the data collection system,

as required for metering installations in accordance with clause 4.4.18.

default event Any one or more of the events listed in clause 3.6.21.

default interest rate An interest rate of 2% above the interest rate.

default notice A notice issued by VENCorp under clause 3.6.21(b).

delivery point A point on a pipeline at which gas is withdrawn from the pipeline and delivered to a Customer or injected into a storage facility.

dispute resolution panel A panel of persons or person appointed by the Adviser under clause 7.2.4(a) to resolve a dispute or disputes under or in connection with these Rules.

Distribution Customer A Customer who withdraws gas at a distribution delivery point.

distribution delivery point A point on a distribution pipeline at which gas is withdrawn from that distribution pipeline and delivered to a Customer or injected into a storage facility.



distribution pipeline A pipeline for the conveyance of gas:

(a) which has a maximum allowable operating pressure of up to 1050 kPa; or

(b) which:

(1) has a maximum allowable operating pressure greater than 1050 kPa;

(2) is functionally distribution in nature (ie few inputs and many outputs); and

(3) is individually and uniquely identified by a pipeline licence number in the Distributor’s access arrangement.

Distribution System Code The Distribution System Code which:

(a) regulates:

(1) the supply of gas to or from a Distributor’s distribution pipeline.

(2) The way in which Customers’ gas installations affect the distribution pipeline to which they are connected

(b) is certified by the ORG.

Distributor A person who owns (whether legally or equitably) or operates the whole or any part of a distribution pipeline.”

EFT facility The Reserve Bank real time gross settlement facility which is made available to all Market Participants in accordance with clause 3.6.2 or where a Reserve Bank real time gross settlement facility is not available, an electronic funds transfer facility to be arranged by VENCorp and made available for all Market Participants in accordance with clause 3.6.2.

electronic communication system

A system used by Participants and VENCorp for exchange of information in accordance with clause 5.1.2(a).

electronic communication procedures

The procedures established by VENCorp and updated from time to time in accordance with clause 5.1.2(e).

emergency An event or situation described in clause 6.2.1(a).

emergency curtailment list The list to be prepared by VENCorp under clause 6.4.3.

emergency directions Directions issued by VENCorp in an emergency under clause 6.5.

emergency procedures The procedures described in clause 6.2.2(a) and set out in the document described in clause 6.2.2(c).

energy calculation The calculation of the energy content of a quantity of gas in accordance with clause 4.4.13.

energy data Data relating to the volume, pressure and temperature of gas.



EoD linepack [deleted by notice published in the Government Gazette dated 28 February 2002]

EoD linepack bid [deleted by notice published in the Government Gazette dated 28 February 2002]

EoD linepack capacity [deleted by notice published in the Government Gazette dated 28 February 2002]

EoD linepack price step [deleted by notice published in the Government Gazette dated 28 February 2002]

Exempt Person GASCOR, being the body established by Division 2 of Part 2 of the Gas Industry (Residual Provisions) Act 1994, and any other person who VENCorp agrees to be exempt.

expansion or extension An expansion or extension as defined in the Tariff Order.

final nomination In respect of a gas day, the last nomination received by VENCorp from a Market Participant prior to the time specified in clause 3.1.7(b)(2).

final operating schedule The schedule which VENCorp is required to publish pursuant to clause 3.1.12(c)(3) in respect of each trading interval and each injection point and system withdrawal zone.

final statement A statement issued by VENCorp under clause 3.6.15.

financial year A period commencing on 1 July in a calendar year and terminating on 30 June in the following calendar year.

flow rate The rate at which gas flows passes a point on the transmission system in an hour, expressed in GJ/hour.

force majeure event An event which satisfies the requirements of clause 6.7.2.



Franchise Customer A Customer if a Retailer who is:

(a) not a Non-Franchise Customer, except a customer who is not a Non-Franchise Customer and who is sold gas by a Retailer in a new area pursuant to a new areas licence issued under section 6B(3) of the Gas Industry Act; or

(b) a Non-Franchise Customer to whom the Retailer under its licence has an exclusive right to sell gas.

.............................MSO Rules Amendments to facilitate Full Retail Contestability:



---- “Franchise Customer” to be deleted without replacement

gas day A period of 24 consecutive hours beginning at 9.00am.

Gas Industry Act The Gas Industry Act 2001 (Vic).

gas production facility Any gas processing plant and associated facilities, excluding any LNG processing or storage facility.

gas quality monitoring system

A system for monitoring gas quality which a Participant is required to provide at a system injection point pursuant to clause 4.3.3.

Gas Quality Regulations Regulations made under sections 33 and 118 of the Gas Safety Act 1997 (Vic) relating to standards of quality of gas.

gas quality specifications In respect of a system injection point:

(1) the prescribed specifications; or

(2) such other gas quality standard as VENCorp may approve in respect of that system injection point pursuant to clause 4.3.2(a).

gas scheduling procedures The scheduling procedures which VENCorp is required to develop, document and make available to Market Participants in accordance with clause 3.1.1(d).

GST Includes the Goods and Services Tax described in the GST Act and any replacement or similar tax.

GST Act Means A New Tax System (Goods and Services Tax) Act 1999 (Cth).



government authority Any government or governmental, semi-governmental, administrative or judicial body, department, commission, authority, tribunal, agency or entity.

inc/dec offer An offer made by a Market Participant in accordance with clause 3.1.5 to modify the quantities of gas which it will inject into, or withdraw from, the transmission system on a gas day.

injection allocation statement

A statement which an Allocation Agent is required to give pursuant to clause 3.5.2(g).

injection inc/dec offer An inc/dec offer made in respect of a system injection point.

injection nomination A nomination in respect of a quantity of gas to be injected into the transmission system.

installation database The database of calibration data which a responsible person is required to keep in respect of its metering installations pursuant to clause 4.4.19.

Intending Participant A person who registers with VENCorp as an Intending Participant under clause 2.5 of these Rules.

Interconnected Pipeline Owner

The owner or operator of a transmission pipeline that is connected to the transmission system.

interest rate The ninety day Bloomberg Bank Bill Swap Reference Rate as published in the Australian Financial Review from time to time.

intervene/intervention Measures taken by VENCorp where there is a threat to system security under clause 6.6.4.

linepack account The account recording linepack credits and linepack debits which VENCorp must maintain in accordance with clause 3.6.10(a).

linepack credit A credit which VENCorp is required to record in the linepack account as determined in accordance with clause 3.6.10(c).

linepack debit A debit which VENCorp is required to record in the linepack account as determined in accordance with clause 3.6.10(c).

linepack transactions Sales and disposals of linepack by VENCorp which are required to be reflected by linepack credits and linepack debits in the daily linepack account.

LNG Liquefied natural gas.

LNG connection point The point on the transmission system at which gas is permitted to flow into or out of the LNG storage facility.

LNG injection offer An offer by a Market Participant to VENCorp to withdraw LNG stock from the LNG storage facility and inject gas into the transmission system at the LNG connection point.



LNG reserve The LNG storage capacity to which VENCorp is entitled under its LNG storage agreement.

LNG stock The amount of LNG in the LNG storage facility held on behalf of VENCorp, a Market Participant or any other person.

LNG storage agreement An agreement between the LNG Storage Provider and VENCorp, a Market Participant or any other person relating to the provision of LNG storage capacity (including the BOC Agreement).

LNG storage facility The LNG storage facility owned by TPA located at Dandenong.

LNG storage capacity Rights to hold capacity in the LNG storage facility granted by the LNG Storage Provider to a Market Participant, VENCorp or any other person pursuant to an LNG storage agreement.

LNG Storage Provider TPA or any person who, as a successor of TPA, operates the LNG storage facility.

LNG storage transfer A transfer of LNG storage capacity or LNG stock in accordance with clause 4.2.6.

Local Retailer In respect of a geographical area, a Retailer whose retail licence issued under the Gas Industry (Residual Provisions) Act 1994 or Gas Industry Act authorises that Retailer to sell gas to Franchise Customers located in that geographical area.

......................MSO Rules Amendments to facilitate Full Retail Contestability:



---- “Local Retailer” to be altered as follows:

Local Host Retailer In respect of a geographical area, a Retailer whose retail licence issued under the Gas Industry Act 1994 authorises that Retailer to sell gas to Franchise Customers located in that geographical area.

For the distribution system operated by TXU Networks (Gas) Pty Ltd (ACN 086 015 036) and its successors the Host Retailer is Pulse Energy Pty Ltd (ACN 090 538 337) and its successors.

For the distribution system operated by Vic Gas Distribution Pty Ltd (ACN 085 899 001) and its successors the Host Retailer is TXU Pty Ltd (ACN 086 014 968) and its successors.

For the distribution system operated by Multinet Gas (DB N0 1) Pty Ltd (ACN 086 026 986) and Multinet Gas (DB N0 2) Pty Ltd (ACN 086 230 122) (trading as “Multinet Partnership”) and its successors the Host Retailer is Origin Energy (Vic) Pty Ltd (ACN 086 013 283) and its successors.



maintenance Works conducted by Pipeline Owners and Storage Providers which, in VENCorp’s opinion, may impact on:

(a) VENCorp’s ability to supply gas through the transmission system;

(b) VENCorp’s ability to operate the transmission system;

(c) transmission system capacity;

(d) system security; or

(e) the efficient operation of the transmission system generally,

and includes, but is not limited to, work conducted on pipeline equipment but does not include maintenance required to avert or reduce the impact of an emergency.

margin call An amount which VENCorp calls to be made by a Market Participant in accordance with clause 3.7.10(b) to make up any anticipated shortfall between that Market Participant’s trading limit and VENCorp’s exposure in respect of that Market Participant.

market A market administered by VENCorp for the injection of gas into, and the withdrawal of gas from, the transmission system and the balancing of gas flows in or through the transmission system.

Market Auditor A person appointed by VENCorp to carry out a Review under clause 5.1.7.

Market Customer A Customer who is a Market Participant.

market fees The fees payable by a Market Participant determined in accordance with clause 2.6 being the tariffs for tariffed VENCorp services.

market information bulletin board

A facility to be established by VENCorp on the electronic communication system on which it may publish information which is then available to and may be accessed by Market Participants.

market objectives The market objectives specified in section 52 of the Gas Industry Act.

Market Participant A Participant who is entitled to participate in the market by submitting nominations and inc/dec offers in accordance with these Rules.

market price The price for gas set by VENCorp for each trading interval as determined in accordance with clause 3.2.

market transaction A sale or purchase of gas which occurs when a Market Participant has a trading imbalance in a trading interval.

maximum total payment The maximum amount payable by VENCorp in respect of a billing period as determined by clause 3.6.22.

meter A device which measures and records volumes and/or quantities of gas.



metering communications procedures

The procedures determined and published by VENCorp from time to time relating to the transfer of energy data from metering installations to the metering database.

metering Recording the volume and quantity of gas.

metering data The data obtained or derived from a metering installation, including energy data.

............................MSO Rules Amendments to facilitate Full Retail Contestability:



---- “metering data ” to be altered as follows:

metering data The data obtained or derived from a metering installation,. including energy data.

metering database The database kept by VENCorp pursuant to clause 4.4.20.

metering installation The meter and associated equipment and installations installed or to be installed for the collection of metering data required for settlement purposes.




---- “metering installation” to be altered as follows:

metering installation The meter and associated equipment and installations installed or to be installed for the collection of metering data required for settlement purposes as required under clause 4.4 for connection points, distribution delivery points and receipt points.

metering point The point of physical connection of a meter to a pipeline.

metering register A register of information relating to metering installations kept by VENCorp pursuant to clause 4.4.21 and forming part of the metering database.

metering substitution threshold

The threshold metering error equal to twice the uncertainty limit (energy) set out in clause 3 of schedule 4.1 and which if exceeded requires substitution of readings in accordance with clause 4.4.24.

minimum exposure VENCorp’s estimate of a Market Participant’s market fees in respect of which that Market Participant is required to provide a bank guarantee under clause 3.7.4(a).



Minister The Minister referred to in Part 9 of the Gas Industry Act.

monitoring point A system injection point or any other point on the transmission system at which VENCorp requires a gas quality monitoring system to be installed in accordance with clause 4.3.3.

NDM meter A meter at a distribution delivery point which is not read daily.

negative reconciliation amount

An amount which a Market Participant is required to pay to VENCorp in respect of a billing period following reconciliation in accordance with clause 3.5.5.

..........................MSO Rules Amendments to facilitate Full Retail Contestability:



---- “negative reconciliation amount” to be deleted without replacement

negative trading imbalance A trading imbalance where the aggregate injections of gas at all system injection points in a trading interval is less than the aggregate adjusted withdrawals of gas as determined in accordance with clauses 3.6.4(b), (c), and (d) for that trading interval.

nomination A nomination by a Market Participant in respect of a quantity of gas to be injected into or withdrawn from the transmission system on a gas day.

Non-Franchise Customer The same meaning as in the Gas Industry Act...........................




---- “Non-Franchise Customer” to be deleted without replacement



non-SAW point A system withdrawal point other than a SAW point..................................




---- “non-SAW point” to be deleted without replacement

off-specification gas Gas which is injected into the transmission system at a system injection point which does not comply with the gas quality specifications for that system injection point.

Office of Gas Safety The Office of Gas Safety established under Part 2 of the Gas Safety Act 1997.

ORG The Office of the Regulator-General established under section 6 of the Office of the Regulator-General Act 1994 (Vic).

Participant A person who is registered with VENCorp in accordance with clause 2.1(a), (b) and/or (c) and clause 2.5.

participant compensation fund

The fund established under clause 3.3.1.

payment date The date on which payment is due in respect of a billing period as determined by clauses 3.6.12 and 3.6.13.

peak flow rate The highest hourly flow rate of gas passing a system point under normal conditions (as determined by VENCorp) in the immediately preceding twelve month period or, if gas has passed a system point for a period of less than twelve months, the highest hourly flow rate which in the reasonable opinion of VENCorp is likely to occur in respect of that system point under normal conditions for the following twelve month period.

pipeline A pipe or system of pipes for or incidental to the conveyance of gas and includes a part of such a pipe or system.



pipeline equipment In relation to a pipeline:

(a) all structures for protecting or supporting the pipeline;

(b) facilities for the compression of gas, the maintenance of the pipeline or the injection or withdrawal of gas;

(c) all fittings, appurtenances, compressor stations, odorisation plants, scraper stations, valves, telemetry systems (including communications towers) and works and buildings used in connection with the pipeline.

Pipeline Owner A person who owns (either legally or equitably) the whole or any part of a pipeline.

planning review An annual planning review or a biannual planning review.

positive reconciliation amount

An amount which VENCorp is required to pay to a Market Participant in respect of a billing period following reconciliation in accordance with clause 3.5.5.

...............................MSO Rules Amendments to facilitate Full Retail Contestability:



---- “positive reconciliation amount” to be deleted without replacement

preliminary operating schedule

A schedule which VENCorp is required to publish pursuant to clauses 3.1.12(c)(1) or (2).

prescribed specifications The uniform gas quality specifications prescribed by the Gas Quality Regulations.

price step An offer by a Market Participant to inject quantities of gas into, or withdraw quantities of gas from, the transmission system on a gas day at a specified price as specified in an inc/dec offer in accordance with clause 3.1.5(b)(4).

pricing schedule A schedule which VENCorp is required to produce pursuant to clause 3.2.1(b).

pricing zone A geographical area within which the market price in any trading interval is the same.

Producer A person who owns or operates a gas production facility or is engaged in the production and processing of gas.

prudential requirements The requirements imposed on a Market Participant to provide and maintain a security in accordance with clause 3.7.

public consultation procedures

The procedures set out in clause 1.4.



publish The posting of information on the market information bulletin board.

quarterly planning reviews Deleted: by Notice published in the Government Gazette dated 4 November 1999

receipt point A point at which gas is received into a pipeline, other than a transfer point, including a point at which gas is received into the pipeline from a storage facility or a gas production facility.

reconciliation amount A positive reconciliation amount or a negative reconciliation amount......................




---- “reconciliation amount” to be deleted without replacement

reconciliation procedures The procedures for the purpose of carrying out reconciliation and adjustment which VENCorp is required to establish under clause 3.5.5(a).

........................MSO Rules Amendments to facilitate Full Retail Contestability:



---- “reconciliation procedures” to be deleted without replacement

Regulator The Australian Competition and Consumer Commission established by section 6A of the Trade Practices Act 1974 (Cth).

related body corporate In relation to a body corporate, a body corporate that is related to the first-mentioned body in accordance with the Corporations Law.

responsible person The person who is responsible for providing a metering installation for a particular system point or a distribution delivery point in accordance with clause 4.4.3.



Retailer A person who holds a retail licence under the Gas Industry (Residual Provisions) Act 1994 or Gas Industry Act and is registered under clause 2.1(b).

…………………………




---- A new definition to be inserted after the definition od “Retailer” as follows:

“Retail Gas Market Rules” Rules made under the Gas Industry Act

Review An examination in accordance with the standard specified for a “review” in Auditing Standard AUS106: “Explanatory Framework for standards on Audit and Audit Related Services” prepared by the Auditing Standards Board of the Australian Accounting Research Foundation, as varied from time to time.

revised statement A statement issued by VENCorp under clause 3.6.19 following the resolution of a dispute or correction of an error relating to a final statement.




---- “revised statment” to be altered as follows:

revised statement A statement issued by VENCorp under clause 3.6.19 following the resolution of a dispute or correction of an error relating to a final statement or a revision determined for the 118th business day after the billing period..

safety plan A plan which must be developed by certain Participants in accordance with the Gas Safety Act 1997 (Vic).

safety procedures The procedures established and maintained by each Participant in accordance with clause 6.3.2.



SAW point A system withdrawal point at which gas is withdrawn from the transmission system and injected into a distribution pipeline and which is designated by VENCorp as a system withdrawal point to which the allocation algorithm applies.

...............................MSO Rules Amendments to facilitate Full Retail Contestability:



---- “SAW point” to be deleted without replacement

scheduled deviation The positive or negative amount by which the injection or withdrawal of gas (as the case may be) for the gas day specified in the scheduling instruction exceeds the injection or withdrawal (as the case may be) for the gas day specified in the pricing schedule.

schedule, scheduling The process of scheduling nominations and inc/dec offers which VENCorp is required to carry out in accordance with these Rules for the purpose of balancing gas flows in the transmission system and maintaining the security of the transmission system.

scheduling error An error made in scheduling, as determined in accordance with clause 3.1.14, which results in a scheduling instruction that differs from the scheduling instruction that would have been issued if VENCorp had complied with the gas scheduling procedures, which (for the avoidance of doubt) does not include an error made in determining the market price.

scheduling instruction An instruction given by VENCorp to a Market Participant or, in the case of an LNG injection offer, to the LNG Storage Provider, pursuant to clauses 3.1.12(h) and (i).

service envelope agreement

An agreement entered between VENCorp and a Transmission Pipeline Owner, as required under clause 5.3.1, pursuant to which the Transmission Pipeline Owner agrees to provide to VENCorp gas transportation services and pipeline capacity in respect of that Transmission Pipeline Owner’s pipelines and, which, for the avoidance of doubt, may be part of an agreement between VENCorp and the Transmission Pipeline Owner which relates also to other matters.

settlement The determination of trading imbalances, trading amounts and settlement amounts in respect of Market Participants who trade in the market.

settlement amount The amount payable by or to a Market Participant in respect of a billing period as determined by VENCorp under clause 3.6.5.

settlement statement A statement issued by VENCorp in the form of a final statement under clause 3.6.15.



significant price variation A significant variation in the market price as determined by VENCorp in accordance with guidelines developed under clause 1.2.1(h).

standing EoD linepack bid An EoD linepack bid that is expressed to apply in respect of each consecutive gas day until a future specified date or until revoked or deemed to be revoked.

standing inc/dec offer An inc/dec offer that is expressed to apply in respect of each consecutive gas day until a future specified date or until revoked or deemed to be revoked.

standing nomination A nomination that is expressed to apply in respect of each consecutive gas day until a future specified date or until revoked or deemed to be revoked.

storage facility A facility for the storage of gas, including the LNG storage facility and underground storage.

Storage Provider A person who owns or operates a storage facility.

storage space In relation to LNG storage capacity, the right of a Market Participant, expressed in tonnes, to store gas in the LNG storage facility in accordance with its LNG storage agreement and these Rules.

Sub-allocation Agent A person who has been appointed by a Market Participant or other person to submit sub-allocation statements under clauses 3.5.2(i) or 3.5.3(i).

sub-allocation statement A statement which a Sub-allocation Agent may submit under clauses 3.5.2(i) or 3.5.3(i).

supplier surplus [Deleted: Order in Council dated 10 March 1999, published in the Government Gazette dated 11 March 1999]

suspension notice A notice issued by VENCorp under clause 3.7.7.

system injection point A connection point on the transmission system which is designed to permit gas to flow through a single pipe into the transmission system, which may also be, in the case of a transfer point, a system withdrawal point.

system point A system injection point, a system withdrawal point or a system withdrawal zone.

system security The operation of the transmission system in a safe and reliable manner and in accordance with the system security guidelines.

system security guidelines The guidelines developed by VENCorp under clause 1.2.1(c).

system withdrawal point A connection point on the transmission system which is designed to permit gas to flow through a single pipe out of the transmission system, which may also be, in the case of a transfer point, a system injection point.



system withdrawal zone Part of the transmission system which contains one or more system withdrawal points and in respect of which VENCorp has determined that a single withdrawal nomination or a single withdrawal inc/dec offer must be made.

tariff D withdrawal point A system withdrawal point to which transmission delivery tariff D is assigned or a distribution delivery point to which distribution tariff D is assigned under the Tariff Order.

Tariff Order The Victorian Gas Industry Tariff Order made under section 48A of the Gas Industry (Residual Provisions) Act 1994, as amended from time to time under section 20 of the Gas Industry Act, and any tariffs and charges which are approved under an access arrangement.

tariff V withdrawal point A system withdrawal point to which transmission delivery tariff V is assigned or a distribution delivery point to which distribution tariff V is assigned under the Tariff Order.

tariffed VENCorp services The services provided by VENCorp under these Rules as described in clause 1.2.1.

time stamp The means of identifying the time and date at which data is transmitted or received.

TPA Transmission Pipelines Australia Pty Ltd ACN 079 089 268

Trader A person, other than a Retailer, Customer or Producer, who injects gas, or tenders gas for injection, into the transmission system and/or withdraws gas, or tenders gas for withdrawal, from the transmission system.

trading amount The sum calculated in accordance with clause 3.6.3(b).

trading limit In respect of a Market Participant at any time means the last trading limit set by VENCorp for the Market Participant under clause 3.7.8(a).

trading imbalance The quantity of gas determined in respect of each Market Participant for each trading interval in accordance with clause 3.6.4.

trading interval A period of one gas day.

transfer point A point at which gas is transferred from the transmission system to a transmission pipeline; from a transmission pipeline to a transmission pipeline; or from the transmission system to a distribution pipeline.

transmission constraint A constraint in or affecting the transmission system at any time as a result of which (having regard to operational requirements relating to pressures) gas flows in any part of the system are or (but for anything done by VENCorp) would be restricted, whether such constraint results from the size of any part of the transmission system, the operation or failure to operate any part of the transmission system or the extent or distribution of supply or demand in any part of the transmission system.

Transmission Customer A Customer who withdraws gas from a transmission delivery point.



transmission delivery point A point on the transmission system at which gas is withdrawn from the transmission system and delivered to a Transmission Customer or injected into a storage facility.

transmission pipeline A pipeline that is not a distribution pipeline.

Transmission Pipeline Owner

A person who owns or holds under a lease a transmission pipeline which is or is to be operated by VENCorp.

transmission system The transmission pipelines or system of transmission pipelines which consists of the “gas transmission system” as defined under the Gas Industry Act.

uplift payment A payment made by a Market Participant to VENCorp under clause 3.6.8.

VENCorp The Gas Transmission System Operator established under the Gas Industry Act.

VENCorp functions The functions of VENCorp set out in section 160 of the Gas Industry Act.

VoLL A price cap, being the maximum, on the market price, as also described in clause 3.2.4.

withdrawal allocation statement

A statement which an Allocation Agent is required to give pursuant to clause 3.5.3(g).

withdrawal inc/dec offer An inc/dec offer made in respect of a system withdrawal zone.

withdrawal nomination A nomination in respect of a quantity of gas to be withdrawn from the transmission system.


Documents

MSO Rules v16 - Australian Energy Regulator | 5 MSOR... · Web viewMSO Rules Amendments to facilitate Full Retail Contestability: The following changes/additions to the MSO Rules